Question

Bogart Company is considering two alternatives. Alternative A will have revenues of $146,100 and costs of $104,400. Alternative B will have revenues of $185,900 and costs of $127,100. Compare Alternative A to Alternative B showing incremental revenues, costs, and net income.

Answer 1

Answer:

Choosing alternative B would increase net income by $17,100

Explanation:

The analysis showing the incremental revenues,costs and net income of alternative A and B is shown below:

              Alternative A           Alternative   B     Difference between A&B

Revenues        $146,100            $185,900           $39800

Costs               ($104,400)           ($127,100)        ($22700 )

Net income      $41,700                 $58,800        $17,100

Alternative B records a higher net income compared to Alternative A,hence choosing alternative B would increase net income by $17,100

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