Lec Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L06-4) [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit S 85 51 S 34 Percent of Sales 1008 60 400 Fixed expenses are $77,000 per month and the company is selling 2,600 units per month, Exercise 6-5 Part 1 Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,200 and monthly sales increase by $15,300? 1-b. Should the advertising budget be increased? Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [L06-4) [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 85 51 $ 34 Percent of Sales 100% 60 408 Fixed expenses are $77,000 per month and the company is selling 2,600 units per month. Exercise 6-5 Part 2 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher quality components that increase the variable expense by $5 per unit and increase unit sales by 20%. 2-b. Should the higher-quality components be used? Exercise 6-6 Break-Even Analysis (L06-5] Mauro Products distributes a single product, a woven basket whose selling price is $25 per unit and whose variable expense is $19 per unit. The company's monthly fixed expense is $16,800, Required: 1. Calculate the company's break-even point in unit sales. 2. Calculate the company's break-even point in dollar sales. (Do not round intermediate calculations.) 3. If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round Intermediate calculations.) Karlik Enterprises distributes a single product whose selling price is $28 per unit and whose variable expense is $22 per unit. The company's monthly fixed expense is $24,000. Required: 2. Calculate the company's break-even point in unit sales. Unit les to break oven units Exercise 6-7 Target Profit Analysis [LO6-6] Lin Corporation has a single product whose selling price is $134 per unit and whose variable expense is $67 per unit. The company's monthly fixed expense is $32,300. Required: 1. Calculate the unit sales needed to attain a target profit of $7,900. (Do not round intermediate calculations.) 2. Calculate the dollar sales needed to attain a target profit of $8,600. (Round your intermediate calculations to the nearest whole number) units 1. Units sales to attain target profit 2. Dollar sales to attain target profit