22. During 2019, Arledge Albums sold 8,000 photo albums. The company's contribution margin was calculated as follows: Per Percent of Unit Sales Sales $200 100% Variable Costs $60 30% CM $140 70% Fixed expenses for 2019 totaled $700,000. For 2020, Arledge is considering decreasing the sales price of their albums by $4 and using paper that costs $3 less than the paper they currently use. They believe that these changes and an increase in advertising of $30,000 will increase demand by 10%. What effect would these changes have on net operating income? $73,200 $85,900 $96,100 $58,400 Elite Company had originally expected to earn operating income of $140,000 in the coming year. Elite's degree of operating leverage is 2.6. Recently, Elite revised its plans and now expects to increase sales by 25% next year. What is the percent change in operating income expected by Elite in the coming year? 20% 54% 65% 8% Ross Company's variable expenses are 82% of sales. Total sales are $303,000 and net operating income is $6,900. How much are total fixed expenses? $47,640 $67,580 $51,920 $48,000