Topper Sports, Incorporated, produces high-quality sports equipment. The company's Racket Division manufactures three tennis rackets-the Standard, the Deluxe, and the Pro-that are widely used in amateur play. Selected information on the rackets is given below: Selling price per racket Variable expenses per racket: Fixed production costs Advertising expense Administrative salaries Total Production Selling (5% of selling price) All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs: Per Month $ 138,000 118,000 68,000 $ 324,000 April May Sales, in units, over the past two months have been as follows: Standard 2,000 8,000 Standard $45.00 Deluxe 1,000 1,000 $ 27.00 $ 2.25 Pro 5,000 3,000 Total Deluxe $ 70.00 8,000 12,000 Pro $ 100.00 $ 35.00 $ 3.50 $36.00 $5.00 Required: 1-a. Prepare contribution format income statements for April. 1-b. Prepare contribution format income statements for May. 3. Compute the Racket Division's break-even point in dollar sales for April. 4. Would the break-even point be higher or lower with May's sales mix than with April's sales mix? 5. Assume that sales of the Standard racket increase by $21,800. What would be the effect on net operating income? What would be the effect if Pro racket sales increased by $21,800? Do not prepare income statements; use the incremental analysis approach in determining your answer.

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