Frazer Corp Sells Several Products What Is the Operating Income Earned If the Company Sells

question 92

Multiple Choice

Frazer Corp sells several products.Information of average revenue and costs is as follows: $\begin{array}{lr}\text { Selling price per unit } & \$ 28.50 \\\text { Variable costs per unit: } & \\\text { Direct material } & \$ 5.50 \\\text { Direct manufacturing labor } & \$ 1.15 \\\text { Manufacturing overhead } & \$ 0.85 \\\text { Selling costs } & \$ 2.50 \\\text { Annual fixed costs } & \$ 125,000\end{array}$ What is the operating income earned if the company sells 15,000 units?

• A) $162,750
• B) $150,000
• C) $148,500
• D) $152,500

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Definitions:

Vertical Line

A straight line that goes from up to down (or down to up) and does not slant; in Cartesian coordinates, it is described by an equation of the form \(x = a\).

Slope-intercept Form

An equation of a straight line in the form y = mx + b, where m is the slope and b is the y-intercept.

Slope-intercept Form

A way of writing the equation of a straight line in the form y = mx + b, where m is the slope and b is the y-intercept.

Slope

A measure of the steepness or the inclination of a line, defined as the ratio of the vertical change to the horizontal change.