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QUESTION: IN 2016, HAGAR CORP. SOLD 3,000 UNITS AT $500 EACH. VARIABLE EXPENSES WERE $350 PER UNIT, AND FIXED EXPENSES WERE $780,000. THE SAME VARIABLE EXPENSES PER UNIT AND FIXED EXPENSES ARE EXPECTED FOR 2017. IF HAGAR CUTS SELLING PRICE BY 4%, WHAT IS HAGAR'S BREAK-EVEN POINT IN UNITS FOR 2017? A. 5,200 B. 5,760 C. 6,000 D. 5,416 JANEEK'S CONTRIBUTION MARGIN IS 40%. THE COMPANY IS CONTEMPLATING AN ADVERTISING CAMPAIGN THAT WILL COST $29,067. IF SALES ARE EXPECTED TO INCREASE $90,114, BY HOW MUCH WILL THE COMPANY'S NET INCOME INCREASE?

QUESTION: IN 2016, HAGAR CORP. SOLD 3,000 UNITS AT $500 EACH. VARIABLE EXPENSES WERE $350 PER UNIT, AND FIXED EXPENSES WERE $780,000. THE SAME VARIABLE EXPENSES PER UNIT AND FIXED EXPENSES ARE EXPECTED FOR 2017. IF HAGAR CUTS SELLING PRICE BY 4%, WHAT IS HAGAR'S BREAK-EVEN POINT IN UNITS FOR 2017? A. 5,200 B. 5,760 C. 6,000 D. 5,416 JANEEK'S CONTRIBUTION MARGIN IS 40%. THE COMPANY IS CONTEMPLATING AN ADVERTISING CAMPAIGN THAT WILL COST $29,067. IF SALES ARE EXPECTED TO INCREASE $90,114, BY HOW MUCH WILL THE COMPANY'S NET INCOME INCREASE?

FINANCIAL ACCOUNTING
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: IN 2016, HAGAR CORP. SOLD 3,000 UNITS AT $500 EACH. VARIABLE EXPENSES WERE $350 PER UNIT, AND FIXED EXPENSES WERE $780,000. THE SAME VARIABLE EXPENSES PER UNIT AND FIXED EXPENSES ARE EXPECTED FOR 2017. IF HAGAR CUTS SELLING PRICE BY 4%, WHAT IS HAGAR'S BREAK-EVEN POINT IN UNITS FOR 2017? A. 5,200 B. 5,760 C. 6,000 D. 5,416 JANEEK'S CONTRIBUTION MARGIN IS 40%. THE COMPANY IS CONTEMPLATING AN ADVERTISING CAMPAIGN THAT WILL COST $29,067. IF SALES ARE EXPECTED TO INCREASE $90,114, BY HOW MUCH WILL THE COMPANY'S NET INCOME INCREASE?
Transcribed Image Text:QUESTION: IN 2016, HAGAR CORP. SOLD 3,000 UNITS AT $500 EACH. VARIABLE EXPENSES WERE $350 PER UNIT, AND FIXED EXPENSES WERE $780,000. THE SAME VARIABLE EXPENSES PER UNIT AND FIXED EXPENSES ARE EXPECTED FOR 2017. IF HAGAR CUTS SELLING PRICE BY 4%, WHAT IS HAGAR'S BREAK-EVEN POINT IN UNITS FOR 2017? A. 5,200 B. 5,760 C. 6,000 D. 5,416 JANEEK'S CONTRIBUTION MARGIN IS 40%. THE COMPANY IS CONTEMPLATING AN ADVERTISING CAMPAIGN THAT WILL COST $29,067. IF SALES ARE EXPECTED TO INCREASE $90,114, BY HOW MUCH WILL THE COMPANY'S NET INCOME INCREASE?
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