Vineyard Company Has Three Product Lines: A,B and C

question 141

Multiple Choice

Vineyard Company has three product lines: A,B and C.The following annual information is available: Assume Vineyard Company can increase the selling price of Product C to $30,000.Assume all other information remains the same.What will happen to operating income?

• A)increase $3,600
• B)increase $6,000
• C)decrease $3,600
• D)decrease $6,000

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Definitions:

Total Costs

The sum of all expenses a firm incurs in producing a product or offering a service, including both fixed and variable costs.

Total Variable Costs

The sum of all costs that vary with output level, including materials, labor, and other expenses that change with production volume.

Techniques of Production

The methods and processes used by firms to produce goods and services efficiently.

Price of Output

The amount of money that a firm receives from the sale of goods and services it produces.