A Company's Manager Estimates That in the Upcoming Year,decreasing Advertising

question 70

Multiple Choice

A company's manager estimates that in the upcoming year,decreasing advertising costs by $35 000 will cause sales revenue to decrease by $80 000.If the company's contribution margin ratio is 40%,what will be overall effect on net income?

• A) Net income will increase by $3000.
• B) Net income will decrease by $3000.
• C) Net income will increase by $18 000.
• D) Net income will decrease by $18 000.

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Definitions:

Pelvic Girdle

The ring of bones in the lower torso, comprised of the two hip bones, sacrum, and coccyx, providing support for the human body's weight.

Axial Skeleton

The axial skeleton is the part of the skeleton that consists of the bones of the head and trunk of a vertebrate, including the skull, spine, sternum, and ribs.

Cancellous Bone

a type of bone that is less dense, more porous, and found at the ends of long bones and in the inner layers of most bones, important for metabolic processes.

Compact Bone

The compact, rigid external layer of bone that offers support and form.