Thornbrough Corporation produces and sells a single product with the following characteristics:
Thornbrough Corporation produces and sells a single product with the following characteristics:
| Per Unit | Percent of sales | |
| Selling price | $220 | 100% |
| Variable expenses | 44 | 20 % |
| Contribution margin | $176 | 80% |
The company is currently selling 7000 units per month Fixed expenses are $901.000 per month
The marketing manager would like to cut the selling price by $18 and increase the advertising budget by $53,000 per month. The marketing manager predicts that these two changes would increase monthly sales by 1000 units. What should be the overall effect on the company's monthly net operating income of this change?
Multiple Choice
decrease of $105.000
Increase of 50.000
increase of $105.000
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Thornbrough Corporation produces and sells a single product with the following characteristics:
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