Question

You are upgrading to better production equipment for your​ firm's only product. The new equipment will allow you to make more of your product in the same amount of time.​ Thus, you forecast that total sales will increase next year by over the current amount of units. If your sales price is per​ unit, what are the incremental revenues next year from the​ upgrade?

Answer 1

$473,760

Step-by-step explanation:

Calculation to determine the incremental revenues next year from the upgrade

Using this formula

Incremental revenues= Units* Percentage Increase in total sales*Sales price

Let plug in the formula

Incremental revenues=94000 units* 24% * $21

Incremental revenues= $473,760

Therefore the incremental revenues next year from the upgrade will be $473,760