Variable Costs as a Percentage of Sales for Lemon Inc

question 125

Multiple Choice

Variable costs as a percentage of sales for Lemon Inc. are 80%, current sales are $600,000, and fixed costs are $130,000. How much will operating income change if sales increase by $40,000?

• A) $8,000 increase
• B) $8,000 decrease
• C) $30,000 decrease
• D) $30,000 increase

Understand the key components of effective collaboration in nursing leadership.

Identify leadership behaviors that define effective nursing management.

Recognize the characteristics and practices of transformational leadership in healthcare settings.

Comprehend situational and contingency theories related to nursing leadership.

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Definitions:

Net Present Value

A financial analysis method used to evaluate the profitability of an investment or project, assessing the value of all future cash flows, both incoming and outgoing.

All-Equity Firms

Companies that are financed entirely through equity without any debt.

Shares Outstanding

The total number of a company's shares of stock that are owned by shareholders including those held by institutional investors and restricted shares held by insiders and company officers.

Market Price

The existing rate at which one can buy or sell an asset or service in the market.