Montery Co. make and sells a single product. The current selling price is $15 per unit. Variable expenses are $9 per uniy, and fixed expenses total $27,000 per month.

Management is considering a change in the sales force compensation plan. Currently each of thr firm's two salepeople is paid a salary of $2,500 per month.

g-1. Calculate the monthly operating income that would result from changing the compensation plan to a salary of $400 per month, plus a commission of $0.80 per unit, assuming a sale volume of 5,400 units per month.

g-2. Calculate the monthly operating income that would result from changing the compensation plan to a salary of $400 per month, plus a commission of $0.80 per unit, assuming a sales volume of 6,000 units per month.

h-1. Assuming that the sales volume of 6,000 units per month achieved in part g could also be acheived by increasing advertising by $1,000 per month instead of changing the sales force compensation plan. What would be the operating income or loss ?