Buffo Company fabricates metal folding chairs. Data concerning the company's revenue and cost structure follow: Selling price per unit $35 Manufacturing cost $4,100 per month plus $15 per unit Administrative expense $2,410 per month plus $1.80 per unit Sales commissions 11% of sales Advertising expense $1,870 per month If Buffo expects to produce and sell 6,700 units next month, the expected net operating income would be: $96,145 $87,765 $116,015 $107,515

Buffo Company fabricates metal folding chairs. Data concerning the company's revenue and cost structure follow:

Selling price per unit	$35
Manufacturing cost	$4,100 per month plus $15 per unit
Administrative expense	$2,410 per month plus $1.80 per unit
Sales commissions	11% of sales
Advertising expense	$1,870 per month

 If Buffo expects to produce and sell 6,700 units next month, the expected net operating income would be:

	$96,145
	$87,765
	$116,015
	$107,515

Answer

$87,765

Sales ($35 x 6,700)		$234,500
Variable expenses:
Manufacturing ($15 x 6,700)	$100,500
Sales commissions (11% x $234,500)	25,795
Administrative ($1.80 x 6,700)	12,060	138,355
Contribution margin		96,145
Fixed expenses:
Manufacturing cost	4,100
Advertising expense	1,870
Administrative	2,410	8,380
Net operating income		$87,765