The Following Information Is Available for the Super Company $$\begin{array} { l r } \text { Sales } & \$ 1,000,000 \\\text { Invested capital } & 312,500 \\\text { ROI } & 20 \%\end{array}$$

question 124

Multiple Choice

The following information is available for the Super Company: $$\begin{array} { l r } \text { Sales } & \$ 1,000,000 \\\text { Invested capital } & 312,500 \\\text { ROI } & 20 \%\end{array}$$ The net income is _____.

• A)$687,500
• B)$312,500
• C)$62,500
• D)$100,000

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Definitions:

Incremental Manufacturing Cost

The additional cost incurred by producing one more unit of a product.

Production Increase

An uptick in the amount of products manufactured by a company over a set period.

Contribution Margin

The amount of revenue from sales that exceeds the variable costs associated with producing a good or service.

Relevant Range

The extent of activity or volume over which the specific cost assumptions and behaviors are considered valid.