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Bohlen Corporation Produces and Sells a Single Product

question 72

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Bohlen Corporation produces and sells a single product. Data concerning that product appear below: Bohlen Corporation produces and sells a single product. Data concerning that product appear below:   Fixed expenses are $716,000 per month. The company is currently selling 6,000 units per month. Consider each of the following questions independently. This question is to be considered independently of all other questions relating to Bohlen Corporation. Refer to the original data when answering this question. Management is considering using a new component that would increase the unit variable cost by $8. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effect on the company's monthly net operating income of this change? A) increase of $54,400 B) decrease of $54,400 C) decrease of $6,400 D) increase of $6,400 Fixed expenses are $716,000 per month. The company is currently selling 6,000 units per month. Consider each of the following questions independently. This question is to be considered independently of all other questions relating to Bohlen Corporation. Refer to the original data when answering this question.
Management is considering using a new component that would increase the unit variable cost by $8. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effect on the company's monthly net operating income of this change?

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Definitions:

Rock Characteristics

The inherent properties of rock, including mineral composition, grain size, texture, hardness, and color, which differentiate one rock type from another.

Wind

The movement of air from areas of high pressure to areas of low pressure, resulting in weather patterns and climatic changes on Earth.

Sand Deposition

The process by which sand is laid down or deposited by wind, water, or ice, often forming beaches, dunes, and other geological structures.

Turbidity Currents

Underwater density flows of sediment-laden water moving downslope, often triggered by earthquakes.

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