In 2013,the MoreForLess Company had revenues of $2,000,000 and costs of $1,500,000.During 2014,MoreForLess will be introducing a new product line that is expected to increase sales revenue by $200,000 and costs by $160,000.Assuming no changes are expected for the other products,the operating profits are expected to increase by

Question

Quizplus · Accepted Answer

To find the increase in operating profits, we need to calculate the increase in revenue and costs separately and then subtract the increase in costs from the increase in revenue.

Increase in revenue = $200,000

Increase in costs = $160,000

Therefore, increase in operating profits = Increase in revenue - Increase in costs
= $200,000 - $160,000
= $40,000

Hence, the answer is D, $40,000.

In 2013,the MoreForLess Company Had Revenues of $2,000,000 and Costs