Sales (100,000 units) Costs $1,000,000 Direct materials $250,000 Direct labour 250,000 Fixed factory overhead 100,000 Variable factory overhead 160,000 Marketing and administration 150,000 Total costs $910,000 Budgeted pretax income $90,000 Direct labour workers are paid hourly wages and go home when there is no work. The marketing and administration costs include $40,000 that varies proportionately with production volume. Assume that sales and production volumes are equal.