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Starforce Avionics makes aircraft instrumentation. Its basic navigation radio requires $60 in variable costs and $2,000 per month in fixed costs. Further processing the radio, to enhance its functionality, will require an additional $25 per unit of variable costs but no change to the fixed costs. The marketing manager believes that the company would be able to increase the sales price from $260 to $280. If Starforce decides to further process the product, operating income would: A. Remain the same B. Increase by $85 per unit C. Decrease by $5 per unit D. Increase by $25 per unit
Sagot :
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