Barrier Corporation Is Performing a Sensitivity Analysis on One of Its

Multiple Choice

Barrier Corporation is performing a sensitivity analysis on one of its product.The product currently sells for $75 per unit, with variable cost of $46 per unit and fixed costs of $100,000.Barrier currently sells 80,000 units of this product.Barrier is considering reducing its price by 10%.If prices decrease, then it is expected that units sold will increase by 8%.Calculate the change in operating income.

A) $462,400 decrease
B) $248,500 decrease
C) $462,400 increase
D) $248,500 increase