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natka813 [3]
3 years ago
8

If a special sales order is accepted for​ 8,100 widgets at a price of​ $39 per​ unit, and fixed costs increase by​ $13,000, how

would operating income be​ affected? (NOTE: Assume regular sales are not affected by the special​ order.)
Business
1 answer:
Lana71 [14]3 years ago
8 0

Answer:

D) Increase by $68,000

Explanation:

The computation of change in the operating income is shown below:

Sales ( 8,100 widgets × $39) $315,900

Less: Variable cost (8,100 widgets × $29) ($234,900)  

Contribution margin $81,000

Less: Increase in fixed assets -$13,000

Net income increased              $68,000

We simply applying the above format so that the change in the operating income could be find out. Since the net income is in positive so it shows an increment

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Answer:

net income = $199,000

Explanation:

In order to calculate net income, we will first start with EBIT or income from operations and then subtract income tax expense, loss from sale of investments and finally income taxes:

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  • Interest expense = $71,000
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