Question
COMPANY currently sells 500 units of its manufactured product per month for $320 per unit. At this current level of sales, COMPANY incurs $45,000 in
COMPANY currently sells 500 units of its manufactured product per month for $320 per unit. At this current level of sales, COMPANY incurs $45,000 in variable expenses and $56,000 in fixed expenses. The sales manager believes that by increasing the monthly advertising budget by $14,000, monthly sales would increase to a total of 750 units. She does not expect a change in the sales price despite the increased sales. What would the change in net operating income be as a result of this increase in the marketing budget assuming that COMPANY sells all the units it produces?
(Input "0" if there is no change in net operating income. Input the change as a positive figure if net operating income increases due to this change. Input the change as a negative figure if net operating income decrease due to this change.)
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