Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. total sales (2,000 units) $500,000 less variable c

Total Sales (2,000 units) $500,000 Less Variable Costs $300,000 Contribution Margin $200,000 Less Fixed Costs...

70.2K

Verified Solution

Question

Accounting

Total Sales (2,000 units) $500,000 Less Variable Costs $300,000 Contribution Margin $200,000 Less Fixed Costs $150,000 Net Operating Income $ 50,000 The information above represents the contribution format income statement of Global Agriculture Suppliers Inc. for agriculture equipment supplied to the Guyana market. The marketing manager of the company argues that if they increase their advertising budget by $4,000 and reduce the selling price by 8% the company would be able to attract government contracts to supply to local farmers. Ultimately, a 10% increase in sales would occur. Which one of the following would be the net operating income if the changes were made?

image The information above represents the contribution format income statement of Global Agriculture Suppliers Inc. for agriculture equipment supplied to the Guyana market. The marketing manager of the company argues that if they increase their advertising budget by $4,000 and reduce the selling price by 8% the company would be able to attract government contracts to supply to local farmers. Ultimately, a 10% increase in sales would occur. Which one of the following would be the net operating income if the changes were made? Select one: A. $22,000 B. $22,500 C. $37,500 D. $50,000

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students