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Modest Seating Company is currently selling 1,500 oversized bean bag chairs a month at a price of $80 per chair. The variable cost of each
Modest Seating Company is currently selling 1,500 oversized bean bag chairs a month at a price of $80 per chair. The variable cost of each chair sold includes $55 to purchase the bean bag chairs from suppliers and a $7 sales commission. Fixed costs are $8,000 per month. The company is considering making several operational changes and wants to know how the change will impact its operating income. Read the ou calculated in Requirement 1. Consider each alternative separately. perating loss.) Operating income from implementing these changes would by from Requirement 1. b. Alternative 2: The company believes that spending an additional $2,000 on advertising would increase sales volume by 8%. (Use parentheses or a minus sign for an operating loss.) Operating income from implementing these changes would by from Requirement 1. Operating income from implementing these changes would by from Requirement 1. change. (Use parentheses or a minus sign for an operating loss.) Operating income from implementing these changes would by from Requirement 1
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