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Here is Guernsey Company's budgeted contribution mari income statement for the upcoming year Sales $600,000 100% Variable costs 420,000 70% Contribution margin $180,000 30% Fixed
Here is Guernsey Company's budgeted contribution mari income statement for the upcoming year Sales $600,000 100% Variable costs 420,000 70% Contribution margin $180,000 30% Fixed costs 126,000 21% $54,000 9% Operating income Average operating assets are budgeted at $300,000. Which of the following changes in business conditions will simultaneously increase Guernsey's turnover and reduce its margin? Guernsey spends $15,000 on an annual advertising campaign that increases sales by 20%. Operating assets remain unchanged O At the beginning of the year, Guernsey tedniceaboo ss of $6,000 on the disposition of obsolete Inventory that had a book value of $6,0 Through better inventory management, Guernsey reduces its average inventory balance by $24,000. O Guernsey reduces its administrative costs by $4.800 per year by simplifying certain processes to make them more efficient O None of the above
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