Question

International Data Systems information on revenue and cost is relevant only up to sales cost of 123,000 units.

After 123,000 units the market becomes saturated and the price per unit falls from $14.00 to $8.80 Also there are cost overruns at a production volume of over 123,000 units and variable cost per unit has goes up from $7 to $7

.50 Fixed cost remains the same at 73,000

A-Compute Operating Income at 123,000 units?

B-Compute Operating Income at 223,000

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