Answer:
$12,300
Explanation:
The computation of the net operating income is shown below:
Sales $85,400 (1,220 units × $70)
Less: Variable cost -$48,190 (1,220 units × $39.5)
Contribution margin $37,210
Less: Fixed expenses -$24,910 ($23,310 + $1,600)
Net operating income $12,300
The cost per unit is
= $70,000 ÷ 1,000 units
= $70
Since the sales units is increased by 220 units, so total units increased by 1,000 units + 220 units = 1,220 units
The variable cost per unit is
= $38,500 ÷ 1,000
= $38.5
The variable units is increased by $1 so total units increased by $38.5 + $1 = $39.5
