Respuesta :
Answer:
Process further; net income per unit will be $1 greater.
Explanation:
Given: Current selling price= $55.
Production cost= $20.
Cost of assembling the product= $12.
New selling price would be $68.
Now, calculating the profit to compare it on both occassion.
Profit with current selling price= [tex]Selling\ price - Cost\ price[/tex]
⇒ Profit with current selling price= [tex]\$ 55 - \$ 20[/tex]
∴ Profit with current selling price= [tex]\$ 35[/tex]
Next profit with new selling price and cost price.
Profit with new selling price= [tex]\$ 68 - (\$ 20+\$ 12)[/tex]
⇒ Profit with new selling price= [tex]\$ 68 - \$ 32[/tex]
∴ Profit with new selling price= [tex]\$ 36[/tex]
Hence, on comparing the profit on both selling price we find that there is an increase in net income [tex](\$ 36-\$ 35) = \$ 1[/tex], therefore, Walton could process further new price.
