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Shelhorse Corporation produces and sells a single product. Data concerning that product appear below: Selling price Variable expenses Contribution margin Per Unit $ 160 40
Shelhorse Corporation produces and sells a single product. Data concerning that product appear below: Selling price Variable expenses Contribution margin Per Unit $ 160 40 $ 120 Percent of Sales 100% 25% 75% Fixed expenses are $345,000 per month. The company is currently selling 4,000 units per month. Required: The marketing manager believes that a $14,000 increase in the monthly advertising budget would result in a 140 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change? Change in net operating income
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