You are a consultant and a client approached you for advice. The client (Oasis) is a wholesaler that distributes a single product. Oasis's revenues and expenses for the last two months are given below: 

 

 

Oasis's management is targeting an operating income of $75,000 for the month of July. To give her the advice, you need to determine the followings:         

a.Determine which of the expenses/costs are variable, fixed, &/or  mixed. Separate the mixed costs/expenses into its variable and fixed components, if any. 

 

b. Compute the company's total variable cost and then contribution margin for the month of June. 

 

b. How many units Oasis needs to sell to achieve the target operating income of $75,000 in the month of July?

Sales in units................ May 1000 Sales revenue.............. $420,000 Cost of goods sold 168,00 0 Salaries and commissions 151,000 121,000 Depreciation expense Net operating income (loss) ($ 20,000) June 1,500 $630,000 252,000 199,000 121,000 $ 58,000