What is the net income impact when iPods are sold for $20 with a COGS of $10?

When an iPod is sold for $20, the revenue generated from the sale is $20. To determine the impact on net income, you must consider the cost of goods sold (COGS), which in this case is $10. Net income is calculated by subtracting the COGS from the total revenue.

In this example, the calculation would be as follows:

• Revenue from the sale: $20

• COGS: $10

• Net income impact: $20 (revenue) - $10 (COGS) = $10

This calculation indicates that the net income increases by $10 as a result of the sale.

The other options suggest different effects on net income which do not align with this straightforward revenue minus cost calculation. Therefore, the correct answer, which reflects the accurate impact on net income, should be that net income increases by $10.

In this case, it’s important to highlight that the claim of a $6 increase as stated in the answer would not reflect the accurate calculation. So, the correct interpretation confirms that the net income indeed increases by $10.