=+The division of costs between fixed and variable is as follows: Fixed Variable Cost ofsales 40% 60%
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=+The division of costs between fixed and variable is as follows:
Fixed Variable Cost ofsales 40% 60%
Selling expenses 50% 50%
Administrative expenses 75% 25%
Management is considering a plant expansion program that will permit an increase of
$487,500 in yearly sales. The expansion will increase fixed costs by $135,000, but will not affect the relationship between sales and variable costs.
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