Current | Proposed | |
Sales | (135*2900)=391500 | (391500+21000)=412500 |
Variable expenses | (81*2900)=234900 | (412500*60%)=247500 |
Contribution margin | 156600 | 165,000 |
Fixed expenses | 87000 | (87000+9200)=96200 |
Net operating income | 69600 | 68800 |
Hence Net operating income decreases by=(69600-68800)=$800
Hence advertising budget should not be increased.
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are...
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