Question by Molly Sue: Andretti Company has a single product called a Dak. The company normally produces and sells 96,000 Daks each y?
Andretti Company has a single product called a Dak. The company normally produces and sells 96,000 Daks each year at a selling price of $ 49 per unit. The company’s unit costs at this level of activity are given below:
Direct materials$ 9.40
Variable manufacturing overhead3.40
Fixed manufacturing overhead7.00 ($ 672,000 total)
Variable selling expenses2.00
Fixed selling expenses6.00 ($ 576,000 total)
Total cost per unit$ 35.80
A number of questions relating to the production and sale of Daks follow. Each question is independent.
(a)Assume that Andretti Company has sufficient capacity to produce 124,800 Daks each year without any increase in fixed manufacturing overhead costs. The company could increase its sales by 30% above the present 96,000 units each year if it were willing to increase the fixed selling expenses by $ 127,000. Compute the Incremental net operating income.
Answer by Record three vio Suspension
Oh my Jesus! Dont say things like that!
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