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Woodridge Corporation manufactures numerous products, one of which is called Alpha-32. The company has provided the following data about this product: Unit sales (a) Selling
Woodridge Corporation manufactures numerous products, one of which is called Alpha-32. The company has provided the following data about this product: Unit sales (a) Selling price per unit Variable cost per unit Traceable fixed expense 100,000 $ 98.00 $ 79.00 $1,713,000 Management is considering increasing the price of Alpha-32 by 8%, from $98.00 to $105.84. The company's marketing managers estimate that this price hike would decrease unit sales by 4%, from 100,000 units to 96,000 units.Assuming that the total traceable fixed expense does not change, what net operating income will product Alpha-32 earn at a price of $105.84 if this sales forecast is correct? Multiple Choice $2,576,640 $971,000 $863,640 $2,684,000
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