Per Unit . % of sales

Selling price . $75 . 100%

Variable Expenses . $45 . 60%

Contribution Margin . $30 40%

Fixed expenses are $75,000 per month and the company is selling 3,000 units per month.

2. Refer to the original data . Management is considering using higher quality components that would increase variable cost by $3 per unit. The manager believes that the higher quality product would increase sales by 15% per month. Should the higher - quality components be used. Show all calculations to justify your answers or response.