Vest Food Co. has the following operating data: $\begin{array}{ll}
\$10.00 & \text { Unit selling price } \
6.00 & \text { Unit variable cost } \
960,000 & \text { Fixed costs }
\end{array}$ The company is contemplating moving to another state where direct labor costs can be reduced, thereby reducing the unit variable cost by 10%. The state where the company currently operates has offered to reduce property taxes to encourage Vest to stay. The minimum amount of property tax savings necessary to keep the company, assuming no other changes, would be:

Question

Vest Food Co. has the following operating data: $\begin{array}{ll}
\$10.00 & \text { Unit selling price } \
6.00 & \text { Unit variable cost } \
960,000 & \text { Fixed costs }
\end{array}$  The company is contemplating moving to another state where direct labor costs can be reduced, thereby reducing the unit variable cost by 10%. The state where the company currently operates has offered to reduce property taxes to encourage Vest to stay. The minimum amount of property tax savings necessary to keep the company, assuming no other changes, would be:

Quizplus · Accepted Answer

The Answer of Vest Food Co. has the following operating data: $\begin{array}{ll}
\$10.00 & \text { Unit selling price } \
6.00 & \text { Unit variable cost } \
960,000 & \text { Fixed costs }
\end{array}$  The company is contemplating moving to another state where direct labor costs can be reduced, thereby reducing the unit variable cost by 10%. The state where the company currently operates has offered to reduce property taxes to encourage Vest to stay. The minimum amount of property tax savings necessary to keep the company, assuming no other changes, would be:

Vest Food Co $10.00 Unit selling price 6.00 Unit variable cost 960,000 Fixed costs \begin{array}{ll}\$10.00 & \text { Unit selling price } \\6.00 & \text { Unit variable cost } \\960,000 & \text { Fixed costs }\end{array}$10.006.00960,000​ Unit selling price Unit variable cost Fixed costs ​

Vest Food Co $\begin{array}{ll}\$10.00 & \text { Unit selling price } \\6.00 & \text { Unit variable cost } \\960,000 & \text { Fixed costs }\end{array}$