Feather Friends, Incorporated, distributes a high$-$quality wooden birdhouse that sells for $$120$ per unit. Variable expenses are $$60\mathrm{.}00$ per unit, and fixed expenses total $$180,000$ per year. Its operating results for last year were as follows:

Sales $ $3,240,000$

Variable expenses $1,620,000$

Contribution margin $1,620,000$

Fixed expenses $180,000$

Net operating income $ $1,440,000$

Required:

Answer each question independently based on the original data:

$5.$ The sales manager is convinced a $11\%$ reduction in the selling price, combined with a $$63,000$ increase in advertising, would increase this year's unit sales by $25\%.$

If the sales manager is right, what would be this year's net operating income if his ideas are implemented?

If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year?

$6.$ The president does not want to change the selling price. Instead, he wants to increase the sales commission by $$2\mathrm{.}20$ per unit. He thinks this move, combined with some increase in advertising, would increase this year's unit sales by $25\%.$ How much could the president increase this year's advertising expense and still earn the same $$1,440,000$ net operating income as last year?