Hanover Binding Plans to Produce 40,000 Books Next Year at a Total

question 78

Multiple Choice

Hanover Binding plans to produce 40,000 books next year at a total cost of $1,640,000 with a selling price per book of $66.00.The fixed costs total $280,000.Management is considering lowering the price to $60.00 per book, and feels that this action will cause sales to climb to 50,000 books.What will be the incremental costs incurred if 50,000 books are sold?

• A)$340,000
• B)$20,000
• C)$1,700,000
• D)$1,300,000

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