Weitman Corporation manufactures numerous products, one of which is called Epsilon-50. The company has provided the following data about this product: Unit sales (a) 130,000 Selling price per unit$29.00 Variable cost per unit$18.00 Traceable fixed expense$1,280,000 ?Management is considering increasing the price of Epsilon-50 by 9%, from$29.00 to $31.61. The company's marketing managers estimate that this price hike would decrease unit sales by 15%, from 130,000 units to 110,500 units. Assuming that the total traceable fixed expense does not change, what net operating income will product Epsilon 50 earn at a price of $31.61 if this sales forecast is correct?
A. $223,905
B. $1,503,905
C. $1,769,300
D. $489,300
Answer: A
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