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ABC Inc., produces and sells a single product as per the below information. Sales volume in units 17,000 Selling price per unit $20 Direct material
ABC Inc., produces and sells a single product as per the below information. Sales volume in units 17,000 Selling price per unit $20 Direct material per unit $5 Direct manufacturing labor per unit $3.60 Variable manufacturing overhead per unit $4 Variable selling costs per unit $1.4 Annual fixed costs $90,000 The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of 50.8 per unit. In exchange, the sales staff would accept a decrease in their salaries of $18,000 per year. The marketing manager predicts that introducing this sales incentive would increase annual sales by 5%. What should be the overall effect on the company's annual net operating income of this change
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