contestada

Pita​ Corporation's management has budgeted the following amounts for its next fiscal​ year: Total fixed expenses $490,000 Selling price per unit $65 Variable expenses per unit $25 If Pita Corporation spends an additional $13,000 on​ advertising, sales volume should increase by 2,000 units. What effect will this have on operating​ income?

Respuesta :

The effect is that there will be an increase in the operating income by $183000.

How to compute the income?

Based on the information given, the following can be deduced:

Increase in contribution = 4900 × (65 - 25) = 196000

Less: Increase in advertising cost = 13000

Increase in operating income = 183000

In this case, the effect is that there will be an increase in the operating income by $183000.

Learn more about operating income on:

brainly.com/question/25895372

#SPJ1

Otras preguntas