Per Unit				Percent of Sales
Selling price	$	135				100	%
Variable expenses		81				60
Contribution margin	$	54				40	%

Fixed expenses are $87,000 per month and the company is selling 2,900 units per month.

How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,200 and monthly sales increase by $21,000? (Do not round intermediate calculations.)

Net operating income

Inc/Dec

by

Should the advertising budget be increased?

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%.

Net operating income

Inc/Dec

by

Should the higher-quality components be used?