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Question
A company produces 1,000 packs of chicken feed per month. Sales price is $4.00 per pack. Variable cost is $1.50 per unit, and fixed costs are $1,800 per month. Management is considering adding a vitamin supplement to improve the value of the product. The variable cost will go up from $1.50 to $1.90 per unit, and fixed costs will go up by 20%. The company will price the new product at $5.00 per pack. If they do so, how will this affect operational income?
A) Go down $150 per month
B) Remain unchanged
C) Go down $400 per month
D) Go up by $240 per month
Answer
This answer is hidden. It contains 149 characters.
Related questions
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D) audited form balance sheet.
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Q:
A) chart of accounts.
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Answer: B
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At the end of the year, actual data were as follows:
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