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A study has been conducted to determine if Product A should be dropped. Total sales of the product are $200, 000 per year, total variable
A study has been conducted to determine if Product A should be dropped. Total sales of the product are $200, 000 per year, total variable expenses are $140,000 per year. Total fixed expenses charged to the product product is per year. The company estimates that $40,000 of these fixed expenses will continue even if the product is dropped. These data indicate that if Product A is dropped, the company's overall operating income Per year would change by how much? A decrease of $10,000. An increase of $20,000. A decrease of $20,000. An increase of $30,000. Why are the net present value and internal rate of return methods of capital budgeting superior to the payback method? Because they are easier to implement. Because they consider the time value of money. Because they require Jess input. Because they reflect the effects of depreciation and income taxes. The net present value method takes into account which of the following? Cash Flow over Time Value Life of Project of Money Option A Option B Option C Option D
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