Woodley Company reports the following contribution margin income statement. Woodley Company Contribution Margin Income Statement For Year Ended December 31 Sales (19,200 units at $225 each) Variable costs (19,200 units at $180 each) Contribution margin Fixed costs Income $ 4,320,000 3,456,000 864,000 648,000 $ 216,000 The marketing manager believes that increasing advertising costs by $162,000 will increase the company's sales volume to 22,000 units. Prepare a contribution margin income statement for the next year assuming the company incurs the additional advertising costs.

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Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.