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Determine what should be the operating income from item a

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Reference no: EM132810022

Problem 1: A company prepared the following forecast pertaining to item A for 2020 assuming no expenditure for advertising: Selling Price per unit P10.00 Unit sales 110,000 Variable costs P600,000 Fixed costs P300,000 Based on the market study in December 2019, the company estimated that it could increase the unit selling price by 15% and increase the units sales by 10% if P100,000 were spent on advertising. Assuming that the company incorporates these changes in its 2020 forecast, what should be the operating income from Item A?

Reference no: EM132810022

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