Adept NV Is Analyzing a Proposed Project

question 78

Multiple Choice

Adept NV is analyzing a proposed project.The company expects to sell 2,500 units, give or take 10%.The expected variable cost per unit is €8 and the expected fixed costs are €12,500.Cost
Estimates are considered accurate within a plus or minus 5% range.The depreciation expense is
€4,000.The sale price is estimated at €16 a unit, give or take 2%.The company bases its sensitivity
Analysis on the expected case scenario.What is the contribution margin per unit under the
Expected case scenario?

• A)€2.67
• B)€3.00
• C)€7.92
• D)€8.00
• E)€8.72

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Definitions:

Net Operating Income

The profit generated from a company's core business operations, excluding income and expenses from non-operational activities.

Traceable Fixed Expense

Fixed costs that can be directly associated with a specific cost object, such as a product, department, or project.

Net Operating Income

A company's profit after subtracting operating expenses but before deducting interest and taxes.

Price Increase

An adjustment in the selling price of goods or services, typically due to higher costs or improved market conditions.