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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 | 60 | 40% |
Contribution Margin | $90 | 60% |
The company is currently selling 5,900 units per month. Fixed expenses are $474,700 per month. The marketing manager believes that a $6,900 increase in the monthly advertising budget would result in a 100 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change? |
a. Decrease of $2,100
b. Increase of $9,000
c. Decrease of $6,900
d. Increase of $2,100
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