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Homework Answers
| Current | Proposed | |
| Sales | (125*2700)=337500 | (337500+20,000)=$357,500 |
| Variable expenses | (80*2700)=216,000 | (357500*64%)=228800 |
| Contribution margin | 121500 | 128700 |
| Fixed expenses | 85000 | (85000+9000)=94000 |
| Net operating income | 36500 | 34700 |
Hence decrease in net operating income=36500-34700=$1800
Hence advertising budget should not be increased.
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Required information The following information applies to the questions displayed below.] Data for Hermann Corporation are...
[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below:...
[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit $ 125 Percent of Sales 100% 64% Selling price Variable expenses 80 Contribution margin $ 45 36% Fixed expenses are $85,000 per month and the company is selling 2,700 units per month. 3. value: 10.00 points Required: 1-a. The marketing manager argues that a $9,000 increase in the monthly advertising budget would increase monthly sales by $20,000. Calculate the increase or decrease...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 140 91 Percent of Sales 100% 65 35% $ 49 Fixed expenses are $88,000 per month and the company is selling 3,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,300 and monthly sales increase by $21,000? 1-b. Should...
Required information (The following information applies to the questions displayed below.] Data for Hermann Corporation are...
Required information (The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 75 51 Percent of Sales 100% 68 $ 24 32% Fixed expenses are $75,000 per month and the company is selling 4,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,900, the monthly sales volume increases by 100 units,...
Required information [The following information applies to the questions displayed below.) Data for Hermann Corporation are...
Required information [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 125 80 $ 45 Percent of Sales 100% 64 36% Fixed expenses are $85,000 per month and the company is selling 2,700 units per month. 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by...
Required information (The following information applies to the questions displayed below.) Data for Hermann Corporation are...
Required information (The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Percent Per Unit of Sales $ 90 1005 63 70 $ 27 30% Fixed expenses are $30,000 per month and the company is selling 2,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $5,000, the monthly sales volume increases by 100 units,...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit Percent of Sales Selling price $ 130 100 % Variable expenses 78 60 Contribution margin $ 52 40 % Fixed expenses are $86,000 per month and the company is selling 2,800 units per month. Garrison 16e Rechecks 2017-05-02 Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,100 and monthly...
Required information [The following information applies to the questions displayed below.) Data for Hermann Corporation are...
Required information [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Percent of Sales 100% Selling price Variable expenses Contribution margin Per Unit $ 90 63 $ 27 70 30% Fixed expenses are $78,000 per month and the company is selling 3,500 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,300 and monthly sales increase by $16,500? 1-b. Should...
Required information (The following information applies to the questions displayed below.) Data for Hermann Corporation are...
Required information (The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 110 77 $ 33 Percent of Sales 100% 70 30% Fixed expenses are $82,000 per month and the company is selling 3,500 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,700 and monthly sales increase by $18,500? 1-b. Should...
[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below....
[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below. Percent of Sales 100% Selling price Variable expenses Contribution margin Per Unit $130 78 $ 52 60 40% Fixed expenses are $86,000 per month and the company is selling 2,800 units per month Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,100 and monthly sales increase by $20,500? 1-b. Should the advertising budget...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 130 78 Percent of Sales 100% 60 40% Fixed expenses are $86,000 per month and the company is selling 2,800 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,100 and monthly sales increase by $20,500? 1-b. Should the advertising...
[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit $ 125 Percent of Sales 100% 64% Selling price Variable expenses 80 Contribution margin $ 45 36% Fixed expenses are $85,000 per month and the company is selling 2,700 units per month. 3. value: 10.00 points Required: 1-a. The marketing manager argues that a $9,000 increase in the monthly advertising budget would increase monthly sales by $20,000. Calculate the increase or decrease...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 140 91 Percent of Sales 100% 65 35% $ 49 Fixed expenses are $88,000 per month and the company is selling 3,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,300 and monthly sales increase by $21,000? 1-b. Should...
Required information (The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 75 51 Percent of Sales 100% 68 $ 24 32% Fixed expenses are $75,000 per month and the company is selling 4,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,900, the monthly sales volume increases by 100 units,...
Required information [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 125 80 $ 45 Percent of Sales 100% 64 36% Fixed expenses are $85,000 per month and the company is selling 2,700 units per month. 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by...
Required information (The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Percent Per Unit of Sales $ 90 1005 63 70 $ 27 30% Fixed expenses are $30,000 per month and the company is selling 2,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $5,000, the monthly sales volume increases by 100 units,...
Required information [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Percent of Sales 100% Selling price Variable expenses Contribution margin Per Unit $ 90 63 $ 27 70 30% Fixed expenses are $78,000 per month and the company is selling 3,500 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,300 and monthly sales increase by $16,500? 1-b. Should...
Required information (The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 110 77 $ 33 Percent of Sales 100% 70 30% Fixed expenses are $82,000 per month and the company is selling 3,500 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,700 and monthly sales increase by $18,500? 1-b. Should...
[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below. Percent of Sales 100% Selling price Variable expenses Contribution margin Per Unit $130 78 $ 52 60 40% Fixed expenses are $86,000 per month and the company is selling 2,800 units per month Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,100 and monthly sales increase by $20,500? 1-b. Should the advertising budget...
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 130 78 Percent of Sales 100% 60 40% Fixed expenses are $86,000 per month and the company is selling 2,800 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,100 and monthly sales increase by $20,500? 1-b. Should the advertising...
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