Owen is considering expanding capacity to the $250,000 level in sales per quarter. The before-tax profit margin from additional sales is 15 percent. How much would before-tax profits increase next year because of this expansion?
A. less than $15,000
B. more than $15,000 but less than $16,000
C. more than $16,000 but less than $17,000
D. more than $17,000
Answer:C
Owen is considering expanding capacity to the $250,000 level in sales per quarter. The before-tax profit margin from additional sales is 15 percent. How much would before-tax profits increase next year because of this expansion?
A. less than $15,000 B. more than $15,000 but less than $16,000 C. more than $16,000 but less than $17,000 D. more than $17,000