Question: 0 4 Required information Exercise 5-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [LO5-4] The following information applies to the questions displayed

 0 4 Required information Exercise 5-5 Changes in Variable Costs, FixedCosts, Selling Price, and Volume [LO5-4] The following information applies to thequestions displayed below. Data for Hermann Corporation are shown below: Part 2

0 4 Required information Exercise 5-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [LO5-4] The following information applies to the questions displayed below. Data for Hermann Corporation are shown below: Part 2 of 2 Percent of Sales 100% 70 30% 10 points Per Unit s 7e Selling price Variable expenses Contribution margin 49 025517 $ 21 Fixed expenses are $74,000 per month and the company is selling 4,400 units per month Exercise 5-5 Part 2 2-a. 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 25%. 2-b. Should the higher-quality components be used? 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 25%. Net operating income Req 2A Req 2B> Req 2A Req 2B Should the higher-guality .compoents be used? Yes ONo

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