Nordic Avionics makes aircraft instrumentation
Its basic navigation radio requires $70 in variable costs and $3,000 per month in fixed costs. Further processing the radio, to enhance its functionality, will require an additional $26 per unit of variable costs but no change to the fixed costs. The marketing manager believes that the company would be able to increase the sales price from $270 to $290. If Nordic decides to further process the product, operating income would ________.
A) remain the same
B) increase by $26 per unit
C) increase by $96 per unit
D) decrease by $6 per unit
D .D)
Sell as is Process further
Sales revenue $270 $290
Less: Variable cost 70 70
Less: Variable cost for further processing 26
Contribution margin $200 $194
Decline in operating income ($200 - $194 ) $6
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Which of the following info items with regard to a major customer must be disclosed?
A) The identity of the customer B) The percentage of the total sales derived from the major customer C) The operating segment making the sale D) The geographic area from which the sale was made
Mass media are not the only vehicles a firm can use to get a message to a potential customer. By what other means can marketers effectively reach out to large numbers of consumers?
A) employing subliminal advertising techniques B) socializing with consumers C) using non-media connectors D) conducting public opinion polls E) placing advertisements in local penny-savers