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By how much would sales have to increase

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Question - O'Brien, Inc.'s 2008 contribution margin income statement shows the following:

Sales @ $8 per unit . . . . . . . . . . . . . . $ 1 60,000

Less: Variable expense . . . . . . . . . . . (1 28,000)

Contribution margin . . . . . . . . . . . . . . $ 32,000

Less: Fixed expenses . . . . . . . . . . . . (44,000)

Operating income (loss) . . . . . . . . . . . $ (1 2,000)

If O'Brien, Inc.'s advertising costs increased by $8,000, by how much would sales have to increase for the company to achieve an operating income of $6,000?

a. $66,000.

b. $96,000.

c. $102,000.

d. $130,000.

e. None of the above.

Reference no: EM131811438

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