Billy-Bob, the Sales Manager at Tropicana Cubana Ltd., a manufacturer of comfortable lawn chairs, emails you a suggestion that a 10% reduction in sales price combined with a $150,000 increase in radio-based advertising expenditures would increase units sold by 50%. While you sit on the beach reading this email, you think that you could probably take a look to see if that would make sense for the company. You review last year's results in the table below. Last Year Sales Less: Variable expenses Contribution margin Less: Fixed expenses Net operating income Total $985,000 435.000 550,000 425.000 $125,000 Per Unit $40.00 17.66 $22.34 Using your knowledge about cost-volume-profit, prepare a comparative income statement to see if what Billy-Bob suggests will improve the bottom line (Hint - you are recreating the contribution margin income statement, adjusting for Billy-Bob's predictions). After preparing the statements, conclude on whether Billy- Bob's prediction that net operating income will increase is correct. (6 marks)