Answer:
If the company sells 5,800 units, its net operating income should be closest to: a. $23,500
Explanation:
Selling price per unit = $224,000/5,600 = $40
Variable expenses per unit = $117,600/5,600 = $21
If the company sells 5,800 units,
Total sales = $40 x 5,800 = $232,000
Variable expenses = $21 x 5,800 = $121,800
Net operating income = Total sales - Variable expenses - Fixed expenses = $232,000 - $121,800 - $86,700 = $23,500
