Kinsley Corporation Manufactures Numerous Products, One of Which Is Called

question 201

Multiple Choice

Kinsley Corporation manufactures numerous products, one of which is called Kappa-03. The company has provided the following data about this product: Management is considering increasing the price of Kappa-03 by 7%, from $36.00 to $38.52. The company's marketing managers estimate that this price hike would decrease unit sales by 10%, from 50,000 units to 45,000 units. Assuming that the total traceable fixed expense does not change, what net operating income will product Kappa-03 earn at a price of $38.52 if this sales forecast is correct?

• A) $626,000
• B) $563,400
• C) $156,000
• D) $93,400

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Definitions:

Organizational Foundation

The basic principles, values, and structure upon which an organization is built and operates.

Visionary Organization

An entity that leads with foresight and innovation, anticipating future trends and preparing for changes ahead of its competitors.

Organizational Strategies

Broad-based plans or approaches adopted by a business or organization to achieve its long-term goals and objectives.

Organizational Tactics

Specific actions or strategies that an organization employs to achieve its objectives and navigate its business environment.