Garfield Industries Is Expanding Its Operations Throughout the Southeast United

question 15

Multiple Choice

Garfield Industries is expanding its operations throughout the Southeast United States. Garfield anticipates that the expansion will increase sales by $1,000,000, and increase the costs of goods sold by $700,000. Depreciation expenses will rise by $50,000 and interest expense will increase by $150,000. The company's tax rate will remain at 40 percent. If the company's forecast is correct, how much will net income increase or decrease, as a result of the expansion?

• A) No change.
• B) $40,000 increase.
• C) $60,000 increase.
• D) $100,000 increase.
• E) $180,000 increase.

---

Definitions:

Nonprofit Organizations

Entities that operate primarily to serve public or social benefits, reinvesting excess revenues into their mission rather than distributing profits to shareholders or owners.

Managers

Individuals responsible for directing, controlling, and overseeing the operations and employees within an organization.

Double Bottom Line

An approach to business and social enterprise that emphasizes not just financial performance but also positive social impact.

Triple Bottom Line

A sustainability framework that evaluates a company's performance based on three factors: environmental, social, and financial.