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# Minden Company

Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each \$2 reduction in the selling price. The company's present selling price is \$98 per unit, and variable expenses are \$68 per unit. Fixed expenses are \$833,700 per year. The present annual sales volume (at the \$98 selling price) is 25,200 units.

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Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each \$2 reduction in the selling price. The company's present selling price is \$98 per unit, and variable expenses are \$68 per unit. Fixed expenses are \$833,700 per year. The present annual sales volume (at the \$98 selling price) is 25,200 units.

Requirement 1:
What is the present yearly net operating income or loss? (Negative amount should be indicated by a minus sign. Omit the "\$" sign in your response.)

Sales (25,200 x \$98) 2,469,600
Less: Variable expenses (25,200 x \$68) 1,713,600
Total Contribution Margin ...

#### Solution Summary

This solution is comprised of a detailed explanation to answer what is the present yearly net operating income or loss.

\$2.19