Fruit Computer Company makes a fruit themed computer. Variable costs are $200 perunit, and fixed costs are $31,000 per month. Fruit Computer Company sells 500 unitsper month at a sales price of $320. The company believes that it can increase the price ifthe computer quality is upgraded. If so, the variable cost will increase to $230 per unit,and the fixed costs will rise by 25%. The CEO wishes to increase the company'soperating income by 10%. Which sales price level would give the desired results? (Roundyour answer to the nearest cent.)O $371.30 per unitO $262.00 per unitO $378.00 per unit.O $1056.00 per unit< Previous

Solution Working note Calculation of existing results Sales price per unit 320 Variable…

Answered: O$371.30 per unit

Business

Accounting

O$371.30 per unit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Fruit Computer Company makes a fruit themed computer. Variable costs are $200 per
unit, and fixed costs are $31,000 per month. Fruit Computer Company sells 500 units
per month at a sales price of $320. The company believes that it can increase the price if
the computer quality is upgraded. If so, the variable cost will increase to $230 per unit,
and the fixed costs will rise by 25%. The CEO wishes to increase the company's
operating income by 10%. Which sales price level would give the desired results? (Round
your answer to the nearest cent.)
O $371.30 per unit
O $262.00 per unit
O $378.00 per unit.
O $1056.00 per unit
< Previous

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