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Required information {The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per

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Required information {The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 80 44 $ 36 Percent of Sales 100% 55 45% Fixed expenses are $76,000 per month and the company is selling 2,500 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,100, the monthly sales volume increases by 100 units, and the total monthly sales increase by $8,000? 1-b. Should the advertising budget be increased? 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $4 per unit and increase unit sales by 20%. 2-b. Should the higher-quality components be used

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