Chaps & Saddles, a retailer of tack and Western apparel, earns an average contribution margin of 40 percent on its sales volume. Recently, the advertising manager of a local “country” radio station offered to run numerous radio advertisements for Chaps & Saddles at a monthly cost of $2,400.

Compute the amount by which the proposed radio advertising campaign must increase Chaps & Saddles’s monthly sales volume to:

a. Pay for itself.
b. Increase operating income by $1,200 per month.