In 2013,the Turnkey Company had consulting revenues of $1,000,000 while costs were $750,000.In 2014,Turnkey will be introducing a new service that will generate $150,000 in sales revenues and $60,000 in costs.Assuming no changes are expected for the other services,operating profits are expected to increase by

Question

Quizplus · Accepted Answer

To find the increase in operating profits, we need to calculate the profits for each year.
In 2013, profits were $1,000,000 - $750,000 = $250,000.
In 2014, profits from existing services will remain the same at $250,000, and profits from the new service will be $150,000 - $60,000 = $90,000.
Total profits in 2014 will be $250,000 + $90,000 = $340,000.
Therefore, the increase in operating profits from 2013 to 2014 will be $340,000 - $250,000 = $90,000. 
Thus, the answer is choice C, $90,000.

In 2013,the Turnkey Company Had Consulting Revenues of $1,000,000 While