Sales (20,000 units @ 60 per unit) $1,200,000 Less: Variable cost 20,000@ $45 900,000 Contribution margin 300,000 Less fixed cost 240,000 Net income 60,000 Assume that through a more intensive effort by the sales force the company's sales increase by 8 percent next year. By what percentage would you expect net operating income to increase? O 2 O none of the above O 6 O 3 O 4

Sales (20,000 units @ 60 per unit) $1,200,000 Less: Variable cost 20,000@ $45 900,000 Contribution margin 300,000 Less fixed cost 240,000 Net income 60,000 Assume that through a more intensive effort by the sales force the company's sales increase by 8 percent next year. By what percentage would you expect net operating income to increase? O 2 O none of the above O 6 O 3 O 4

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter4A: Nopat Breakeven: Revenues Needed To Cover Total Operating Costs

Section: Chapter Questions

Problem 1EP

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