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Wilson Company prepared the following preliminary budget assuming no advertising expenditures: Selling price...................... $10 per unit Unit sales........................... 100,000 Variable expenses.............. $600,000 Fixed expenses.................. $300,000

Wilson Company prepared the following preliminary budget assuming no advertising expenditures:

Selling price......................

$10 per unit

Unit sales...........................

100,000

Variable expenses..............

$600,000

Fixed expenses..................

$300,000

Based on a market study, the company estimated that it could increase the unit selling price by 15% and increase the unit sales volume by 10% if $100,000 were spent on advertising. Assuming that these changes are incorporated in its budget, what should be the budgeted net operating income?

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