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Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit $ 100 Percent of Sales
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit $ 100 Percent of Sales 100% Selling price Variable expenses Contribution margin 61 61 $ 39 39% Fixed expenses are $80,000 per month and the company is selling 3,700 units per month. 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 $3 per unit and increase unit sales by 15%. 2-b. Should the higher-quality components be used
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