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    Net operating income

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    Information concerning Label Corporation's operations follow:

    Variable expenses...$240,000
    Fixed expenses...$40,000

    Assuming that Label increased sales by 20%, what should net operating income be...choices are?

    a. $20,000

    b. $24,000

    c. $32,000

    d. $80,000

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    The variable cost as a percentage of sales is ...

    Solution Summary

    The solution explains the calculation of net operating income.