B. This answer results from considering Printing and Binding to be a fixed expense instead of a variable expense.

C. This answer is incorrect. See the correct answer for an explanation.

D. The fixed costs are: Development, $35,000; Typesetting, $18,500; Depreciation, $9,320; General and Administrative, $7,500; and Miscellaneous Fixed Costs, $4,400, for a total of $74,720 in fixed costs. The variable costs are: Printing and Binding, $5.00 per copy ($30,000 ÷ 6,000 copies); Sales Commissions, $.90 per copy (2% of $45); Bookstore Commissions, $11.25 per copy (25% of $45); and Author Royalties, $4.50 per copy (10% of $45). Since the desired operating earnings is a percentage of revenue, we treat that like another variable cost. The cost is $9.00 per copy (20% of $45). These total to $30.65.The unit contribution margin we will use, then, is $45.00 - $30.65, which is $14.35.Dividing the total fixed costs of $74,720 by the contribution margin of $14.35, we get 5,206.97, or 5,207 units that need to be sold in order to generate operating earnings before interest and taxes of 20% on sales. At this sales level, the fixed costs are covered and an additional 20% of sales revenue is earned, over and above the expenses.