Point Company sells three different products that are similar, but are differentiated by various product features....
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Point Company sells three different products that are similar, but are differentiated by various product features. Budgeted sales by product and in total for the coming year are shown below: Product Percentage of total sales Standard 58% Deluxe Premium 10% 32% Total 100% Sales $120,000 $50,000 $80,000 $250,000 Less: Variable costs 36,000 40,000 44,000 120,000 Contribution margin Less: Fixed expenses $ 84,000 $10,000 $36,000 $130,000 $117,000 $13,000 Net operating income If customers are indifferent to which of the products to purchase from Point Company, which product line should sales personnel recommend to customers that would most improve overall operating income? Select one: A. Product line with the highest sales price B. Product line with the highest percentage of total budgeted sales C. Product line with the lowest variable cost D. Product line with the highest contribution margin ratio Point Company sells three different products that are similar, but are differentiated by various product features. Budgeted sales by product and in total for the coming year are shown below: Product Percentage of total sales Standard 58% Deluxe Premium 10% 32% Total 100% Sales $120,000 $50,000 $80,000 $250,000 Less: Variable costs 36,000 40,000 44,000 120,000 Contribution margin Less: Fixed expenses $ 84,000 $10,000 $36,000 $130,000 $117,000 $13,000 Net operating income If customers are indifferent to which of the products to purchase from Point Company, which product line should sales personnel recommend to customers that would most improve overall operating income? Select one: A. Product line with the highest sales price B. Product line with the highest percentage of total budgeted sales C. Product line with the lowest variable cost D. Product line with the highest contribution margin ratio
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