Variable costs as a percentage of sales for Lemon Inc. are 73%, current sales are $647,000, and fixed costs are $190,000. How much will operating income change if sales increase by $37,200? a. $10,044 increase b. $27,156 increase c. $27,156 decrease d. $10,044 decrease

Variable costs as a percentage of sales for Lemon Inc. are 73%, current sales are $647,000, and fixed costs are $190,000. How much will operating income change if sales increase by $37,200? a. $10,044 increase b. $27,156 increase c. $27,156 decrease d. $10,044 decrease

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

Variable costs as a percentage of sales for Lemon Inc. are 73%, current sales are $647,000, and fixed costs are $190,000.

How much will operating income change if sales increase by $37,200?

a. $10,044 increase

b. $27,156 increase

c. $27,156 decrease

d. $10,044 decrease

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