Benjamin Company Had the Following Results of Operations for the Past

question 59

Multiple Choice

Benjamin Company had the following results of operations for the past year:
$$\begin{array} { l r l r } \text { Sales } ( 16,000 \text { units at } \$ 10 ) & & \$ 160,000 \\\text { Direct materials and direct labor } & \$ 96,000 & \\\text { Overhead (20\% variable) } & 16,000 & \\\text { Selling and administrative expenses (all fixed) } & 32,000 & ( 144,000 ) \\\hline \text { Operating income } & & \$ 16,000 \\\hline \end{array}$$ A foreign company offers to buy 4,000 units at $7.50 per unit.In addition to variable manufacturing costs,selling these units would increase fixed overhead by $600 and selling and administrative costs by $300.Assuming Benjamin's productive capacity is 16,000 units per year and it accepts the offer,its profits will:

• A)Decrease by $10,000.
• B)Decrease by $10,900.
• C)Decrease by $6,000.
• D)Increase by $9,100.
• E)Increase by $4,300.

Identify the suitable interior temperatures for transporting refrigerated freight.

Explain the advantages and disadvantages of using different materials in trailer construction.

Know the standards and regulations for highway truck and trailer operations in North America.

Identify factors contributing to wear and the need for reinforcement in trailer flooring.

---

Definitions:

Customers' Responses

Feedback or reactions of customers to a product, service, or interaction with a business.

Price Lining

A pricing strategy where products or services are grouped into categories based on different price points to target various consumer segments.

Target Pricing

A pricing strategy where the selling price of a product is calculated based on the desired profit margin and the cost to make or buy the product, aiming to ensure competitiveness and affordability.

Product Composition

The combination of different components, materials, or elements that make up a product.