Limitless Labs offers three basic drug-testing services for professional athletes. The budget for the 2nd Quarter of 2022 is shown below. Limitless Labs Budgeted Contribution Margin Analysis - Quarter 2, 2022 Basic Tests Retests Priority Tests Total Testing Volume (units) 850 100 50 Revenue $425,000 $500 $80,000 $800 $250,000 $5,000 1,000 $755,000 Variable costs 102,000 $120 40,000 $400 140,000 $2,800 282,000 Contribution Margin $323,000 $380 $40,000 $400 $110,000 $2,200 $473,000 Direct Fixed Costs 105,000 Segment Margin $218,000 35,000 $5,000 50,000 190,000 $60,000 $283,000 Common Fixed Costs 180,000 Operating income Income taxes (21%) $103,000 21,630 Net Operating income $ 81,370 499 words Variable costs include the labor costs of the medical technicians and consumable materials for testing. Fixed costs total $370,000 per year, consisting of equipment depreciation (direct fixed costs), and building depreciation and administration costs (common fixed costs). A basic "unit" is a routine test administered. A retest is given if there is concern about the results of the first test, particularly if the test indicates that the athlete tests positive for drugs that are on the banned list. Retests are not done by the laboratory that performed the basic test but instead are conducted by a different Lab in the network. A "priority" test is the laboratory's code for a high-profile case. This might be a test of a famous athlete and/or a test that might be challenged in court. The laboratory does extra work and uses expert technicians to ensure the accuracy of priority tests. Limitless Labs is subject to a 21% tax rate. Text Predictions: On Accessibility. Investigate