$[$The following information applies to the questions displayed below.$]$

Data for Hermann Corporation are shown below:

Fixed expenses are $$81,000$ per month and the company is selling $3,800$ units per month.

$2-$a$.$ Refer to the data above. 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 $20\%.($See below for a hint if you are having

trouble getting to the right answer.$)$

$2-$b$.$ Should the higher$-$quality components be used?

Answer is not complete.

Complete this question by entering your answers in the tabs below.

Req $2A$

Req $2B$

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 $20\%.$