Classic Loungers Is in the Process of Preparing a Production

question 140

Multiple Choice

Classic Loungers is in the process of preparing a production cost budget for August.Actual costs in July for 200 chaise lounge chairs were: $$\begin{array} { l r } \text { Materials cost } & 6,000 \\\text { Labor cost } & 8,000 \\\text { Rent } & 2,000 \\\text { Depreciation } & 4,000 \\\text { Other fixed costs } & 5,000 \\\text { Total } & \$ 25,000 \\\hline\end{array}$$ Each chair was sold for $140 in July.Management estimates that sales will increase to 230 chairs during August if the company lowers the selling price to $130 per chair.Materials and labor are the only variable costs.How much is the incremental revenue associated with the price reduction?

• A)$200
• B)$2,100
• C)$3,750
• D)$1,900

---

Definitions:

Persuasion Technique

Strategies or methods employed to influence others' beliefs, attitudes, or behaviors towards a particular idea, object, or action.

Social Sciences

The multidisciplinary study of human society and relationships among individuals within it.

Lobbying Group

An organization that seeks to influence public policy and decision-making processes within political, economic, and social systems.

Process of Persuasion

The method of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through argument, reasoning, or appeal.