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QUESTION
Spencer Corporation has a single product whose selling price is $10. At an expected sales level of $1,000,000, the company's variable expenses are...
- Spencer Corporation has a single product whose selling price is $10. At an expected sales level of $1,000,000, the company's variable expenses are $600,000 and its fixed expenses are $300,000. The marketing manager has recommended that the selling price be increased by 20%, with an expected decrease of only 10% in unit sales. What would be the company's net operating income if the marketing manager's recommendation is adopted?
a. $132,000 b. $290,000 c. $180,000 d. $240,000
- The answer is (d )but can you guys help me to find out how to get to this number please?
