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What will the outcome be for operating income

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Reference no: EM133062021

Question -

A company has provided the following data:

Sales 50,000 units

Sales price $100 per unit

Variable cost $70 per unit

Fixed cost $30,000

If the dollar contribution margin per unit is increased by 15%, total fixed cost is decreased by 25%, and all other factors remain the same, what will the outcome be for operating income?

a. Decrease by $50,000.

b. Increase by $3,500.

c. Increase by $232,500.

d. Increase by $200,000.

Reference no: EM133062021

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