Dream Thrum, Co. is expecting the following changes will occur during the upcoming period: ...
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Accounting
Dream Thrum, Co. is expecting the following changes will occur during the upcoming period:
- The sales price will increase from $106 to $111 per unit
- Variable costs will increase from $36 to $45 per unit
- Fixed costs will decrease from $821,700 to $702,300
- Sales volume will decrease from 17,000 to 15,000 units
If all of these changes occur, by how much will net income change in the upcoming period as compared to the current net income (ignore taxes)?
| a. | Increase by $111,400 | |
| b. | Increase by $80,600 | |
| c. | Decrease by $111,400 | |
| d. | Decrease by $287,700 | |
| e. | Decrease by $80,600 |
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