Using Incremental Analysis
Fortress Hill Corporation has assembled the following information related to the purchase of a new cable car:
|Increase in revenue||$44,200||$49,300|
|Increase in annual operating costs:|
|Fixed overhead (including depreciation)||12,400||12,400|
Using incremental analysis and only relevant information, compute the difference in favor of the Valley machine.
|Difference in Favor of Valley Machine|
|Increase in revenue||$|
|Increase in annual operating costs|
|Total increase in operating costs||$|
|Resulting change in operating income||$|
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