Question - Kevin Couriers Company prepared the following static budget for the year:
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Static Budget
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Units/Volume
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5,000
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Per Unit
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Sales Revenue
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$7.00
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$35,000
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Variable Costs
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1.50
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7,500
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Contribution Margin
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27,500
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Fixed Costs
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4,000
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Operating Income /(Loss)
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$23,500
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If a flexible budget is prepared at a volume of 7,500, calculate the amount of operating income. The production level is within the relevant range.