QUESTION 4 The accountant of Titledale Ltd presents the following income statements which represent the high and low levels of business activity for 2007: TITLEDALE LTD Income Statements March December Sales in units 3 000 7 000 R R Sales 360 000 840 000 Less: Cost of goods sold 240 000 and 560 000 for December Gross profit 120 000 280 000 Less: Expenses Packaging costs 6 000 14 000 Sundry expenses 17 000 29 000 Advertising expense 24 000 24 000 Salaries 27 000 27 000 Total expenses 74 000 94 000 Net profit 46 000 186 000 Note: Sundry expenses are mixed. REQUIRED: Calculate the following and show all your workings:

4.1 A contribution income statement at the 7 000-unit level of activity.