​Given the Following Information, What Happens to Operating Income and Net

question 37

Essay

​Given the following information, what happens to operating income and net income if output is increased by 10 percent? Verify your answer.​
Total assets $100,000
Debt (12% interest rate) $80,000
Equity $20,000
Variable costs of production $14 per unit
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Fixed cost of production $27,000
Units sold 12,300
Sale price per unit $19.75
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Definitions:

Manipulated

Altered or controlled in a deliberate way, often to achieve a specific effect in an experiment or study.

Recall

The act of retrieving information or memories from the past, with or without the use of an explicit cue.

Cognitive Processes

Cognitive functions related to the acquisition, analysis, and retention of information.

Cognitive Processes

Mental activities involved in acquiring, storing, retrieving, and using information, including perception, memory, thinking, and language.