Answer this without using chatgpt or AI The cost to manufacture an unfinished unit is $140 ($95variable, $45 fixed). The selling price per unit is $155. Thecompany has the unused productive capacity and hasdetermined that units could be finished and sold for $198with an increase in variable costs of 40%.What is the additional net income per unit to be gainedby finishing the unit?

Concept of Variable CostVariable cost refers to expenses that change in direct proportion to…

Answered: The cost to manufacture an unfinished…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section14.A: Breakeven Analysis

Problem 7P

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The cost to manufacture an unfinished unit is $140 ($95 variable, $45 fixed). The selling price per unit is $155. The company has the unused productive capacity and has determined that units could be finished and sold for $198 with an increase in variable costs of 40%. What is the additional net income per unit to be gained by finishing the unit?
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