Answer
A 4% increase in fixed costs will cause operating income to
increase by USD 84,000 as depicted below. Revised operating income will be USD 484,000.
Work Step by Step
(W-1)
Revised Fixed Costs (2,100,000 × 96%) 2,016,000
Cost Accounting (15th Edition)
by Horngren, Charles T.; Datar, Srikant M.; Rajan, Madhav V.
Published by
Prentice Hall
ISBN 10:
0133428702
ISBN 13:
978-0-13342-870-4
Chapter 3 - Cost-Volume-Profit Relationships - Assignment Material - Exercises - Page 94: 3-19(4)
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