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Required information Exercise 2-5 (Algo) Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (LO2-4) (The following information applies to the questions displayed below.)
Required information Exercise 2-5 (Algo) Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (LO2-4) (The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Perlunit Percent of Sales idor Selling price Variable expenses Contribution margin $ 38 401 Fixed expenses are $79,000 per month and the company is selling 3,600 units per month Exercise 2-5 (Algo) Part 2 2-a. How much will net operating income increase (decrease) per month if the company uses higher quality components that increase the variable expense by $3 per unit and increase unit sales by 10%. 2-b. Should the higher quality components be used? Complete this question by entering your answers in the tabs below
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