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How much should net operating income increase

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Reference no: EM132516898

Dora Adventures Ltd, distributes a high quality backpack that sells for $20 per unit.

Variable costs are $8 per unit and fixed costs total $180 000 per year.

Question 1: Due to an increase in demand, the company estimates that sales will increase by $75 000 during the next year. By how much should net operating income increase (or net loss decrease) assuming that fixed costs do not change?

Reference no: EM132516898

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