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Dybala Corporation's produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $150 100% Variable expenses
Dybala Corporation's produces and sells a single product. Data concerning that product appear below: |
Per Unit | Percent of Sales | |
Selling price | $150 | 100% |
Variable expenses | 90 | 60% |
Contribution margin | $ 60 | 40% |
The company is currently selling 7,000 units per month. Fixed expenses are $363,900 per month. The marketing manager believes that a $7,400 increase in the monthly advertising budget would result in a 200 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change? |
Increase of $12,000
Decrease of $7,400
Increase of $4,600
Decrease of $4,600
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