Ranger Corporation is currently selling widgets for $40 at a cost of $20 per unit. Fixed costs are currently $500 and the current production is 100 widgets. What is the Operating Cash Flow at this output level

$2000

Explanation:

From the question, we are informed that Ranger Corporation is currently selling widgets for $40 at a cost of $20 per unit and that the fixed costs are currently $500 and the current production is 100 widgets.

The Operating Cash Flow at this output level will be:

= (P - V) × Q

where p = selling price = $40

v = cost price = $20

q = quantity = 100

= ($40 - $20) × 100

= $20 × 100

= $2000

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