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Fixed expenses for Pure Leaf total $30,000 and the company is currently selling 5,000 bottles per month. Selling Price $35 per unit Variable Expenses $20
Fixed expenses for Pure Leaf total $30,000 and the company is currently selling 5,000 bottles per month.
Selling Price $35 per unit
Variable Expenses $20 per unit
Contribution Margin $15 per unit
How much will monthly profit (aka net operating income) increase or decrease if the monthly advertising budget increases by $5,000 and monthly sales increase by $35,000.
(A) $10,000 increase(B) $7,000 increase(C) $10,000 decrease(D) $4,000 decrease
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