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Question 6 (19 marks) a) Rothe Company manufactures and sells a single product that it sells for $90 per unit and has a contribution margin
Question 6 (19 marks) a) Rothe Company manufactures and sells a single product that it sells for $90 per unit and has a contribution margin ratio of 35%. The company's fixed expenses are $46,800. If Rothe, desires a monthly target net operating income equal to 15% of sales, the number of sales in units will have to be (rounded)? (12 marks) b) Pool Company's variable expenses are 36% of sales. Pool is contemplating an advertising campaign that will cost $20,000. If sales increase by $80,000, the company's net operating income should increase by how much? (7 marks)
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