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Winthrop Corporation produces and sells a single product. Data for that product are: Sales price per unit $285 Variable cost per unit $1 ?0 Fixed
Winthrop Corporation produces and sells a single product. Data for that product are: Sales price per unit $285 Variable cost per unit $1 ?0 Fixed expenses for the month $690.000 Currently selling 11.000 units Upper management is considering using a biodegradable packaging which costs $6 more per unit but it produces less waste in the long run. Management plans to increase advertising by $6,000 in the rst month to advertise this new feature to their packaging. The}.r believe that environmentally friendly people will switch to their product resulting in an increase in sales of 3,000 units per month. What should be the overall effect on the company's montth operating income in the rst month if this change is implemented? 0 A. Decrease of $261000 O B. Increase of $267,000 0 C. Decrease of $255.000 (E) D. Increase of $255,000 Jeffrey Enterprises has budgeted the following amounts for its next fiscal year: Total fixed expenses $53,000 Selling price per unit $45 Variable expenses per unit $15 If Jeffrey Enterprises can reduce fixed expenses by $13,320, how will breakeven sales in units be affected? O A. Increase by 444 units O B. Decrease by 222 units O C. Increase by 222 units O D. Decrease by 444 units
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