Its line of amplifiers carries a 3-year warranty against defects. On the basis of past experience the estimated warranty costs related to dollar sales are first year after sale—2% of sales revenue; second year after sale—3% of sales revenue; and third year after sale—5% of sales revenue. Sales and actual warranty expenditures for the first 3 years of business were:

Miller company’s most recent contribution format income statement is shown below: total per unit sales (20,000 units) $300,000 $15.00 variable expenses 180,000 9.00 contribution margin 120,000 $6.00 fixed expenses 70,000 net operating income $ 50,000 required: prepare a new contribution format income statement under each of the following conditions (consider each case independently): (do not round intermediate calculations. round your "per unit" answers to 2 decimal places.) 1. the number of units sold increases by 15%.