Stuart Manufacturing produces metal picture frames. The company's income statements for the last two years are presented below:

Last year

This year

Units sold

50,000

70,000

Sales

$800,000

$1,120,000

Less: Cost of goods sold

550,000

710,000

Gross margin

250,000

410,000

Less: Operating expenses

150,000

190,000

Net income

$100,000

$220,000

The company has no beginning or ending inventories. All activity in this problem is in the relevant range.

Required:

a. Estimate the company's total variable cost per unit, and its total fixed costs per year. (Remember that this is a manufacturing firm.)

b. Compute the company's contribution margin for this