Markson Company Had the Following Results of Operations for the Past

question 126

Multiple Choice

Markson Company had the following results of operations for the past year: $\begin{array} { | l | l | l | } \hline \text { Sales } ( 8,000 \text { units at } \$ 20 ) & \$ 160,000 & \\\hline \text { Variable manufacturing costs } & \$ 86,000 & \\\hline \text { Fixed manufacturing costs } & 15,000 & \\\hline \text { Variable selling and administrative expenses } & 12,000 & \\\hline \text { Fixed selling and administrative expenses } & 20,000 & ( 133,000 ) \\\hline \text { Operating income } & & \$ 27,000 \\\hline\end{array}$
A foreign company whose sales will not affect Markson's market offers to buy 2,000 units at $14 per unit. In addition to existing costs, selling these units would increase fixed overhead by $1,600 for the purchase of special tools. Markson's annual productive capacity is 12,000 units. If Markson accepts this additional business, its profits will:

• A) Decrease by $1,600.
• B) Increase by $1,900.
• C) Decrease by $5,100.
• D) Decrease by $5,650.
• E) Increase by $3,500.

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Definitions:

Referent Power

A form of influence based on the leader or influencer's personality and ability to attract followers through charisma, competence, or moral example.

Centrality

The importance or influence of a role or position within a network or system, often determined by the number of connections or dependencies.

Ingratiation

A psychological strategy where an individual attempts to make themselves more likable or appealing to others, often to gain favor or approval.

Information Control

The management and regulation of information flow within an organization, focusing on optimizing access and protecting confidentiality.