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The DesMaris Company had the following income statement for the month of November 2018: DesMaris Company Income Statement For the Month of November 2018 Sales
The DesMaris Company had the following income statement for the month of November 2018:
DesMaris Company Income Statement For the Month of November 2018 | ||
Sales ($60 10,000 units) | $600,000 | |
Cost of goods sold: | ||
Direct materials | $120,000 | |
Direct labor | 90,000 | |
Variable factory overhead | 75,000 | |
Fixed factory overhead | 120,000 | 405,000 |
Gross profit | $195,000 | |
Selling and administrative expenses: | ||
Variable | $ 15,000 | |
Fixed | 90,000 | 105,000 |
Operating income | $ 90,000
| |
If DesMaris Company expects sales revenue to increase by 3%, by approximately what percentage will operating income increase?
a. 20%
b. 6.50%
c. 3.5%
d. 10%
e. 9.23%
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