Computing overall net operating income

Reference no: EM1364634

60. (Ignore income taxes in this problem.) In order to receive $12,000 at the end of three years and $10,000 at the end of five years, how much must be invested now if you can earn 14% rate of return?
A) $12,978. C) $13,290.
B) $8,100. D) $32,054.

61.Lusk Company produces and sells 15,000 units of Product A each month. The selling price of Product A is $20 per unit, and variable expenses are $14 per unit. A study has been made concerning whether Product A should be discontinued. The study shows that $70,000 of the $100,000 in fixed expenses charged to Product A would continue even if the product was discontinued. These data indicate that if Product A is discontinued, the company's overall net operating income would:
A) decrease by $60,000 per month. C) increase by $20,000 per month.
B) increase by $10,000 per month. D) decrease by $20,000 per month.

Reference no: EM1364634

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