Help Save & Exit Submit Proctoring Enabled: MH Lab 2: Cost Volume-Profit 11 Seed Memofax, Inc. produces memory enhancement software for computers, Sales have been very erratic, with some months showing a profit and some months showing a loss. The company's contribution format income statement for the most recent month is given below: 00:30:14 Sales (18,000 units) Less Variable expens Contribution margin Less: Fixed expenses Het operating Lo BOOK Me Graw $450,000 270,000 180.000 108,000 (8,000) Required: 1. Compute the company's CM ratio and its break-even point in both units and dollars. (Do not round intermediate calculations. Round your "Break-even point in units" answer up to nearest whole number.) Contribution margin ratio Break-even point in units 40 18.000 Break-even point in dollars $ 470,000 2. The sales manager feels that an $20,000 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will result in a $130,000 increase in monthly sales. If the sales manager is right, what will be the effect on the company's monthly net operating Income or loss? (Use the incremental approach in preparing your answer) noase in monthly net operating income 32.000 < Prev 11 of 14 Next >