Answer 1
Reduce by $ 1,675.
Calculations:
Present | Proposed | |
Sales | $ 370,000 | $ 387,500 |
Less: Variable Cost | $ 225,700 | $ 236,375 |
Contribution | $ 144,300 | $ 151,125 |
Less: Fixed Cost | $ 80,000 | $ 88,500 |
Net Operating Income | $ 64,300 | $ 62,625 |
Difference | $ 1,675 |
Answer 2
No
In case of any doubt, please comment.
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