ABC Trading produces a product that sells for $110.00 per unit. Variable costs to manufacture and sell the unit amount to $80.00 per unit. Fixed costs and expenses are going to amount to $150,000 per period.

1. If basic salaries to the sales personnel were to be increased by $12,000, calculate the increase in sales that would be required to cover the increase.

2. The sales manager believes that sales revenue can be increased by R100,000 if he is given additional funds for a sales promotion. What is the maximum amount that he may be allowed to spend so that the company does not lose money on the promotion?