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Slughorn Company produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 270 100% Variable
Slughorn Company produces and sells a single product. Data concerning that product appear below: |
Per Unit | Percent of Sales | ||
Selling price | $ | 270 | 100% |
Variable expenses | 108 | 40% | |
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Contribution margin | $ | 162 | 60% |
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Fixed expenses are $367,000 per month. The company is currently selling 6,200 units per month. |
The marketing manager believes that a $24,000 increase in the monthly advertising budget would result in a 160 unit increase in monthly sales. |
Required: |
What should be the overall effect on the company's monthly net operating income of this change? (Negative amount should be indicated by a minus sign.) |
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