Question
Woodridge Corporation manufactures numerous products, one of which is called Alpha32. The company has provided the following data about this product: Unit sales (a) 90,000
Woodridge Corporation manufactures numerous products, one of which is called Alpha32. The company has provided the following data about this product: Unit sales (a) 90,000 Selling price per unit $ 99.00 Variable cost per unit $ 78.00 Traceable fixed expense $ 1,690,000 Management is considering increasing the price of Alpha32 by 4%, from $99.00 to $102.96. The companys marketing managers estimate that this price hike would decrease unit sales by 5%, from 90,000 units to 85,500 units. Assuming that the total traceable fixed expense does not change, what net operating income will product Alpha32 earn at a price of $102.96 if this sales forecast is correct? Multiple Choice $556,400 $2,246,400 $444,080 $2,134,080
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