Pascal Corporation Manufactures Numerous Products, One of Which Is Called

question 89

Multiple Choice

Pascal Corporation manufactures numerous products, one of which is called Gamma66. The company has provided the following data about this product: Management is considering decreasing the price of Gamma66 by 4%, from $51.00 to $48.96. The company's marketing managers estimate that this price reduction would increase unit sales by 10%, from 100,000 units to 110,000 units. Assuming that the total traceable fixed expense does not change, what net operating income will product Gamma66 earn at a price of $48.96 if this sales forecast is correct?

• A) $(74,000)
• B) $1,645,600
• C) $75,600
• D) $1,496,000

---

Definitions:

Network of Relationships

A complex set of connections between individuals or entities that interact with each other in various ways.

Critical Competence

Essential skills or capabilities necessary for effectively performing a specific job or task.

Functional

Relating to the natural operation or purpose of something, often seen in terms of departments or roles within organizations.

Divisional

Pertaining to a type of organizational structure where operations are segmented based on divisions, each focusing on a particular product line or geographic area.