AC75136 company produces and sells a product with the following characteristics:

	Per Unit
Selling price	$	226
Variable expenses		47
Contribution margin	$	179

The AC75136 company is currently selling 6,600 units per month. Fixed expenses are $894,000 per month.

The sales manager would like to introduce commissions as an incentive for the sales staff. The sales manager has proposed a commission of $21 per unit. In exchange, the sales staff would accept a decrease in their salaries of $39,000 per month. (This is the company's savings for the entire sales staff.)

The manager predicts that introducing this sales incentive would increase monthly unit sales by 16%. What would be the overall effect on AC75136 company's monthly net operating income of this change?

Multiple Choice

• increase of $102,720

• increase of $67,248

• increase of $128,768

• increase of $83,080