Multiple Choice
During 2012,Thor Lab supplied hospitals with a comprehensive diagnostic kit for $120.At a volume of 80,000 kits,Thor had fixed costs of $1,000,000 and a profit before income taxes of $200,000.Due to an adverse legal decision,Thor's 2013 liability insurance increased by $1,200,000 over 2012.Assuming the volume and other costs are unchanged,what should the 2013 price be if Thor is to make the same $200,000 profit before income taxes? (CPA adapted)
A) $122.50.
B) $135.00.
C) $152.50.
D) $240.00.
Correct Answer:
Verified
Correct Answer:
Verified
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