HiTech Manufactures Two Products: Regular and Super

question 13

Multiple Choice

HiTech manufactures two products: Regular and Super. The results of operations for 20x1 follow. Fixed manufacturing costs included in cost of goods sold amount to $3 per unit for Regular and $20 per unit for Super. Variable selling expenses are $4 per unit for Regular and $20 per unit for Super; remaining selling amounts are fixed.
Disregard the information in the previous question. If HiTech eliminates Regular and uses the available capacity to produce and sell an additional 1,500 units of Super, what would be the impact on operating income?

• A) $28,000 increase
• B) $45,000 increase
• C) $55,000 increase
• D) $85,000 increase
• E) None of the other answers are correct.

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Definitions:

Confrontation

A direct engagement or encounter between individuals often involving a challenge or dispute.

Compromise

A solution to a disagreement where each party gives up something to reach a mutually acceptable outcome.

Compromise

A solution to a conflict or problem where all parties involved agree to concessions to reach a mutual agreement.

Confrontation

A direct encounter between individuals or groups characterized by a clash of opinions, beliefs, or interests, often used in therapeutic contexts to address issues.