Answer:
Operating income will increase by $3000
Explanation:
Total Contribution = (30-21)*10000 = 90000
Operating income = 90000-60000 = 30000
Increase in sales by 2000 units then,
Total contribution = (30-21)*12000 = 108000
Operating income = 108000-60000-15000 = 33000
Hence operating income will increase by 33000-30000 = $3000
Answer:
$3,000
Explanation:
The operating income is the difference between the revenue and the total cost. The total cost is the sum of the fixed and variable costs. Both revenue and variable cost are dependent on the level of activity of the business.
Given that Selling price per unit: $30 Variable expenses per unit: $21 Fixed expenses for the period: $60,000 Sales volume in units: 10,000
Operating income = 10,000 ($30 - $21) - $60,000
= $30,000
If sales increases by 2000 units after an additional cost of $15,000 is incurred, Operating income will be
= 12,000 ($30 - $21) - $60,000 - $15,000
= $33,000
Increase in operating income = $33,000 - $30,000
= $3,000
