The Net Change in Operating Income Resulting from a Decision

question 14

Multiple Choice

The net change in operating income resulting from a decision to manufacture product A2 is:

• A)$15,000 (increase).
• B)$15,000 (decrease).
• C)$5,000 (increase).
• D)$45,000 (increase).

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Definitions:

Corporate Income

Refers to the total earnings or profit generated by a company before tax.

Payroll Taxes

Taxes imposed on employers and employees, calculated as a percentage of the salaries that employers pay to their staff.

Sales Taxes

Taxes imposed by governments on the sale of goods and services, typically calculated as a percentage of the sales price.

Federal Spending

The total amount of money spent by the federal government of a country on various national programs, services, and obligations.