Buttercrumbs Bakery Expects to Sell 1

Multiple Choice

Buttercrumbs Bakery expects to sell 1.25 million scones next year for $1.50 each.The variable cost of a scone is $0.80.Fixed costs are $150,000, depreciation $200,000 and the tax rate is 34%.If the bakery can increase the price of a scone to $1.75, sales will fall by 50,000 scone.All other things equal, operating cash flow will increase or decrease by

A) $300,000 increase.
B) $148,500 increase.
C) $148,500 decrease.
D) $174,900 increase.