Exercise 5-5 (Algo) Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L05-4) [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 65 39 $ 26 Percent of Sales 1004 60 404 Fixed expenses are $73,000 per month and the company is selling 4,300 units per month. Exercise 5-5 (Algo) Part 1 Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9700, the monthly sales volume increases by 100 units, and the total monthly sales increase by $6,500? 1-b. Should the advertising budget be increased? 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,700, the monthly sales volume increases by 100 units, and the total monthly sales increase by $6,500? 1-6. Should the advertising budget be increased? Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B How much wil net operating income increase (decrease) per month if the monthly advertising budget increases by $9,700, the monthly sales volume increases by 100 units, and the total monthly sales increase by $6,500? (Do not round intermediate calculations.) Net operating income decreases by $ 3,200 The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price variable expenses Contribution margin Per Unit $ 65 39 $ 26 Percent of Sales 1001 60 401 Fixed expenses are $73,000 per month and the company is selling 4,300 units per month Exercise 5-5 (Algo) Part 2 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher quality components that increase the variable expense by $5 per unit and increase unit sales by 25%. 2-6. Should the higher-quality components be used? 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $5 per unit and increase unit sales by 25% 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Reg 2A Req 28 Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher- quality components that increase the variable expense by $5 per unit and increase unit sales by 25% Not operating income increases by 39,875