Shown here is an income statement in the traditional format for a firm with a sales volume of 7,900 units. Cost formulas also are shown:

Revenues	$	34,900
Cost of goods sold ($5,900 + $2.20/unit)		23,280
Gross profit	$	11,620
Operating expenses:
Selling ($1,150 + $0.09/unit)		1,861
Administration ($3,900 + $0.15/unit)		5,085
Operating income	$	4,674

Required:

a. Prepare an income statement in the contribution margin format.

b. Calculate the contribution margin per unit and the contribution margin ratio.

c. Calculate the firm's operating income (or loss) if the volume changed from 7,900 units to

1. 11,850 units.
2. 3,950 units.

D. Refer to your answer to part a for total revenues of $34,900. Calculate the firms operating income (or loss) if unit selling price and variable expenses per unit do not change and total revenues

1. Increase by $12,500.
2. Decrease by $2,000.