The Fashion Shoe Company operates a chain of women’s shoe shops that carry many styles of shoes that are all sold at the same price. Sales personnel in the shops are paid a sales commission on each pair of shoes sold plus a small base salary.

The following data pertains to Shop 48 and is typical of the company’s many outlets:

Per Pair of Shoes
Selling price $ 40.00
Variable expenses:
Invoice cost $ 15.00
Sales commission 5.00
Total variable expenses $ 20.00
Annual
Fixed expenses:
Advertising $ 47,000
Rent 38,000
Salaries 185,000
Total fixed expenses $ 270,000
Required:

3. If 13,100 pairs of shoes are sold in a year, what would be Shop 48’s net operating income (loss)?