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The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit Percent of Sales 100% 70% $70 Selling
The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit Percent of Sales 100% 70% $70 Selling price Variable expenses 49 Contribution margin $21 30% Fixed expenses are $74,000 per month and the company is selling 4,400 units per month. Required 1-a. The marketing manager argues that a $9,800 increase in the monthly advertising budget would increase monthly sales by $24,000. Calculate the increase or decrease in net operating income. Net operating ncome by 1-b.Should the advertising budget be increased? O Yes O No
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