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Frieden Company's contribution format income statement for last month is shown below: Sales (30,000 units) Variable expenses Contribution margin Fixed expenses Operating income $1,080,000 810,000
Frieden Company's contribution format income statement for last month is shown below: Sales (30,000 units) Variable expenses Contribution margin Fixed expenses Operating income $1,080,000 810,000 270,000 243, 000 $ 27,000 Competition is intense, and Frieden Company's profits vary considerably from one year to the next. Management is exploring opportunities to increase profitability. 4-a. Refer to the original data. Instead of doing the major upgrade to the equipment, management is considering introducing a new advertising campaign that will increase fixed expenses by $20,000 per month. Management believes the new advertisements will increase monthly unit sales by 10%. In this case what would be imapact on operating income. Operating income
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