Assume the following amounts: Total fixed costs $ 23 comma 000 Selling price per unit $ 19 Variable costs per unit $ 12 If sales revenue per unit increases to $ 22 and 14 comma 000 units are sold, what is the operating income? A. $ 163 comma 000 B. $ 117 comma 000 C. $ 308 comma 000 D. $ 140 comma 000

B. $ 117 comma 000

Explanation:

Selling price per unit $ 19 *14, 000= $ 266000

Variable costs per unit $ 12 *14, 000= $ 168,000

Contribution Margin                       $ 98,000

Less Total fixed costs                     $ 23, 000

Operating Income                                      $ 75,000

If sales revenue per unit increases to $ 22

Selling price per unit $ 22 *14, 000= $ 308000

Variable costs per unit $ 12 *14, 000= $ 168,000

Contribution Margin                       $ 140,000

Less Total fixed costs                     $ 23, 000

Operating Income                                      $ 117,000

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