Question

yak has a selling price of $110 per unit, and variable cost per unit of $45. At a sales volume of 350 units, net income is $10,932. If sales are 425 units, net income will be closest to: Group of answer choices

Answer 1

Answer:

Net income= $15,807

Explanation:

Giving the following information:

Selling price= $110 per unit

Unitary variable cost= $45

At a sales volume of 350 units, net income is $10,932.

First, we need to calculate the fixed costs:

Fixed costs= total contribution margin - net income

Fixed costs= 350*(110 - 45) - 10,932

Fixed costs= $11,818

Now, the net income for 435 units:

Net income= total contribution margin - fixed costs

Net income= 425*65 - 11,818

Net income= $15,807