Solved: How much does suttons operating income increase for each, Accounting Basics

How much does suttons operating income increase for each

Question - Sutton Company produces flash drives for computers, which it sells for $20 each. Each flash drive costs $6 of variable costs to make. During April, 700 drives were sold. Fixed costs for April were $4 per unit for a total of $2,800 for the month. How much does Sutton's operating income increase for each $1,000 increase in revenue per month?

$700.

$500.

$14,000.

Not enough information to determine the answer.

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Accounting Basics: How much does suttons operating income increase for each

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