Fig Newton Industries Is Considering a Project and Has Developed

question 99

Multiple Choice

Fig Newton Industries is considering a project and has developed the following estimates: unit sales = 7,300,price per unit = $149,variable cost per unit = $91,fixed costs = $216,400.The depreciation is $94,700 a year and the tax rate is 40 percent.What effect would an increase of $1 in the selling price have on the operating cash flow?

• A)$4,380
• B)$4,823
• C)$5,316
• D)$5,448
• E)$7,300