The PC Supply manufactures memory cards that sell to wholesalers for $2.00 each. Variable and fixed costs are as follows: Variable Costs per card Fixed Costs per Month Manufacturing Direct materials $0.30 Direct labor 0.25 Factory overhead 0.25 0.80 Factory overhead $4,000 Selling and admin. 0.15 Selling and admin. 3,000 Total $0.95 Total $7,000 PC Supply produced and sold 10,000 cards during October 2010. There were no beginning or ending inventories.

a. Prepare a contribution income statement for the month of October.

b. Determine PC Supplys monthly break-even point in units.

c. Determine the effect on monthly profit of a 1,100 unit increase in monthly sales.

d. If PC Supply is subject to an income tax of 28 percent, determine the dollar sales volume is required to earn a monthly after-tax profit of $22,000.