Variable Costs as a Percentage of Sales for Protoveo Inc

question 3

Multiple Choice

Variable costs as a percentage of sales for Protoveo Inc.are 65%, sales are $500,000, and fixed costs are $125,000.How much would operating income change if sales decrease by $10,000?

• A) $3,500 increase
• B) $3,500 decrease
• C) $3,250 decrease
• D) $3,500 increase.

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Definitions:

Internal Jugular

A major vein in the neck, carrying blood from the head, brain, face, and neck back to the heart.

Posterior Intercostal

Pertaining to the muscles and arteries located between the ribs at the back side of the body, assisting in the mechanical aspect of breathing.

External Iliac Artery

A major artery that supplies blood to the lower limbs, originating from the common iliac artery.

Femoral Artery

A major artery in the thigh that supplies blood to the lower limb, being a continuation of the external iliac artery.