Sales

$$188,000,000$

$(102,000,000)$

$$86,000,000$

Cost of goods sold

Gross profit

$\frac{(102,000,000)}{\text{\$}86,000,000}$

Expenses:

The division of costs between variable and fixed is as follows:

Required:

Determine the total variable costs and the total fixed costs for the current year.

Determine $($a$)$ the unit variable cost and $($b$)$ the unit contribution margin for the current year.

Unit variable cost $

Unit contribution

margin

Compute the break$-$even sales $($units$)$ for the current year.

$\text{'}$ units

Compute the break$-$even sales $($units$)$ under the proposed program for the following year.

$$ units

Determine the amount of sales $($units$)$ that would be necessary under the proposed program to realize the $$60,300,000$ of operating income that was earned in the current year.

$$ units

Determine the maximum operating income possible with the expanded plant.

$x$

If the proposal is accepted and sales remain at the current level, what will the operating income or loss be for the following year?

$x$ Income vPortmann Company, operating at full capacity, sold $1,000,000$ units at a price of $$188$ per unit during the current year. Its income statement is as follows:

Sales $$188,000,000$

Cost of goods sold $(102,000,000)$

Gross profit $$86,000,000$

Expenses:

Selling expenses $$15,000,000$

Administrative expenses $10,700,000$

Total expenses $(25,700,000)$

Operating income $$60,300,000$