Yashinski Corporation manufactures numerous products,one of which is called Alpha46.The company has provided the following data about this product:
Required:
a.Management is considering increasing the price of Alpha46 by 15%,from $45.00 to $51.75.The company's marketing managers estimate that this price hike would decrease unit sales by 25%,from 110,000 units to 82,500 units.Assuming that the total traceable fixed expense does not change,what net operating income will Alpha46 earn at a price of $51.75 if this sales forecast is correct?
b.Assuming that the total traceable fixed expense does not change,how many units of Alpha46 would Yashinski need to sell at a price of $51.75 to earn the same net operating income that it currently earns at a price of $45.00? (Round your answer up to the nearest whole number.)

Question

Yashinski Corporation manufactures numerous products,one of which is called Alpha46.The company has provided the following data about this product:
  Required:
a.Management is considering increasing the price of Alpha46 by 15%,from $45.00 to $51.75.The company's marketing managers estimate that this price hike would decrease unit sales by 25%,from 110,000 units to 82,500 units.Assuming that the total traceable fixed expense does not change,what net operating income will Alpha46 earn at a price of $51.75 if this sales forecast is correct?
b.Assuming that the total traceable fixed expense does not change,how many units of Alpha46 would Yashinski need to sell at a price of $51.75 to earn the same net operating income that it currently earns at a price of $45.00? (Round your answer up to the nearest whole number.)

Quizplus · Accepted Answer

The Answer of Yashinski Corporation manufactures numerous products,one of which is called Alpha46.The company has provided the following data about this product:
  Required:
a.Management is considering increasing the price of Alpha46 by 15%,from $45.00 to $51.75.The company's marketing managers estimate that this price hike would decrease unit sales by 25%,from 110,000 units to 82,500 units.Assuming that the total traceable fixed expense does not change,what net operating income will Alpha46 earn at a price of $51.75 if this sales forecast is correct?
b.Assuming that the total traceable fixed expense does not change,how many units of Alpha46 would Yashinski need to sell at a price of $51.75 to earn the same net operating income that it currently earns at a price of $45.00? (Round your answer up to the nearest whole number.)

Yashinski Corporation Manufactures Numerous Products,one of Which Is Called Alpha46