Suppose

240,000

units are sold but only

40,000

of them are deluxe. Compute the operating income. Compute the breakeven point in units. Compare your answer with the answer to requirement 1. What is the major lesson of this problem?

Compute the operating income if

240,000

units are sold but only

40,000

of them are deluxe.

	Standard Carrier	Deluxe Carrier	Total
Units sold
Revenues at $30 and $38 per unit
Variable costs at $24 and $28 per unit
Contribution margin
Fixed costs
Operating income