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GIVEN: Selling Price Variable Expenses Contribution Margin Per Unit % of Sales 90 100% 63 70% 27 30% Fixed expenses are 30,000 per month and
GIVEN: Selling Price Variable Expenses Contribution Margin Per Unit % of Sales 90 100% 63 70% 27 30% Fixed expenses are 30,000 per month and the company is selling 2,000 units per month. 1. The marketing manager believes that a 5,000 increase in advertising would increase monthly sales by $9,000. Should the advertising budget be increased? If sales increase by $9,000, how many more UNITS is that? Current Contribution Margin Inc Stmt Changed Contribution Margin Inc Stmt 2. Refer to the original data. Management is considering using higher quality components that would increase the variable cost by $2/unit. The marketing manager believes that the higher quality component would increase monthly sales by 10% per month. Should we do it
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