# As production increases. variable costs per unit

 5) option a Stays the same 6) option a the excess of sales revenue over variable cost 7) operating profit Contribution (1,000,000*60%)= 600000 less fixed cost -420,000 Net operating profit 180000 option a $180,000 8) contribution ratio =100-80% = 20% increase in income thus 40,000*20% 8000 option a$8,000 increase 9) option D cash budget 10) TRUE option a