Bell Brothers Has $3,000,000 in Sales

Multiple Choice

Bell Brothers has $3,000,000 in sales.Fixed costs are estimated to be $100,000 and variable costs are equal to 50.00% of sales.The company has $1,000,000 in debt outstanding at a before-tax cost of 9.00%.If Bell Brothers' sales were to increase by 20.00%,how much of a percentage increase would you expect in the company's net income? Do not round intermediate calculations.

A) 18.09%
B) 22.90%
C) 20.15%
D) 28.40%
E) 24.73%