Topper Sports, Inc., produces high-quality sports equipment. The company's Racket Division manufactures three tennis rackets-the Standard, the Deluxe, and the Pro-that are widely used in amateur play. Selected information on the rackets is given below: Standard Deluxe Pro $ 45.00 $ 70.00 Selling price per racket Variable expenses per racket: $100.00 $ 35.00 $ 27.00 $ 2.25 $ 3.50 $ 36.00 $ 5.00 Production Selling (5% of selling price) All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs: Per Month $ 138,000 Fixed production costs Advertising expense Administrative salaries 118,000 68,000 $ 324,000 Total Sales, in units, over the past two months have been as follows: Standard Deluxe Pro Total April May 2,000 1,000 5,000 8,000 1,000 3,000 12,000 8,000

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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 Assume that sales of the Standard racket increase by $21,800. What would be the effect on net operating income? What would be the effect if Pro racket sales increased by $21,800? Do not prepare income statements; use the incremental analysis approach in determining your answer.

Topper Sports, Inc., produces high-quality sports equipment. The company's Racket Division manufactures three tennis rackets-the
Standard, the Deluxe, and the Pro-that are widely used in amateur play. Selected information on the rackets is given below:
Standard
Deluxe
Pro
$ 45.00
$ 70.00
Selling price per racket
Variable expenses per racket:
$100.00
$ 27.00
$ 2.25
$ 35.00
$ 3.50
$
Production
$ 36.00
Selling (5% of selling price)
5.00
All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs:
Per Month
$ 138,000
118,000
68,000
$ 324,000
Fixed production costs
Advertising expense
Administrative salaries
Total
Sales, in units, over the past two months have been as follows:
Standard Deluxe
Pro
Total
2,000
8,000
April
1,000
1,000
5,000
3,000
8,000
12,000
Мay
Transcribed Image Text:Topper Sports, Inc., produces high-quality sports equipment. The company's Racket Division manufactures three tennis rackets-the Standard, the Deluxe, and the Pro-that are widely used in amateur play. Selected information on the rackets is given below: Standard Deluxe Pro $ 45.00 $ 70.00 Selling price per racket Variable expenses per racket: $100.00 $ 27.00 $ 2.25 $ 35.00 $ 3.50 $ Production $ 36.00 Selling (5% of selling price) 5.00 All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs: Per Month $ 138,000 118,000 68,000 $ 324,000 Fixed production costs Advertising expense Administrative salaries Total Sales, in units, over the past two months have been as follows: Standard Deluxe Pro Total 2,000 8,000 April 1,000 1,000 5,000 3,000 8,000 12,000 Мay
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