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miv72 [106K]
3 years ago
15

Management is considering using a new component that would increase the unit variable cost by $50. Since the new component would

improve the company's product, the marketing manager predicts that monthly sales would increase by 500 units. What should be the overall effect on the company's monthly net operating income of this change if fixed expenses are unaffected
Business
1 answer:
katrin [286]3 years ago
7 0

Answer:

Because fixed costs will not change, the overall effect on the company's monthly net operating income will be equal to the contribution margin of the product once the new component is added.

Explanation:

The contribution margin is equal to: Revenue - Variable Costs.

We already know that the variable cost will be increased by $50 once new component is added, and that monthly sales are expected to increase by 500 units after that.

Depending on the price of the product, the amount sold, and the variable costs, we get the contribution margin, and this contribution margin will be exactly the same as the overall effect on the net operating income.

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Varvara68 [4.7K]

Answer:

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4 0
3 years ago
Suppose that Hickory Manufacturing, Inc., a corporation headquartered in North Carolina, believes that it is entitled to a $24,7
iragen [17]

Answer: in a federal court, since the United States is a party to the litigation.

Explanation:

Based on the scenario in the question, in case Hickory Manufacturing elects to sue the United States in order to get back the $24700 federal tax refund which wasn't given to the company, it must be done in a federal court because the the IRS is a federal administrative agency and hence, the matter can't be pursued in the North Carolina state court.

Therefore, the correct option is A "in a federal court, since the United States is a party to the litigation".

6 0
3 years ago
MG Lighting had sales of 500 units at $100 per unit last year. The marketing manager projects a 15 percent decrease in unit volu
kakasveta [241]

Answer:

The answer is: Projected net sales for this year are $45,254

Explanation:

The current total sales for MG Lighting are $50,000 (= 500 units x $100 per unit).

Next year their products will have a $10 increase (10%), so the unit price will be $110.

Due to the price increase, the number of units sold will decrease by 15%, to a total of 425 units.

MG Lighting total sales will be $46,750. Approximately 3.2% of the total sales will be returned (equivalent to $1,496).

MG Lighting net sales for this year should be $45,254 (= 46,750 - $1,496)

6 0
3 years ago
What is bank interest​
Fynjy0 [20]

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3 0
2 years ago
Read 2 more answers
During which phase does an employee returning from a foreign assignment experience culture shock in reverse?
weeeeeb [17]
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3 years ago
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