Question: 8) Data concerning Alonzo Corporation's single product appear below: Per Unit Percent of Sales Selling price $ 100 100% Variable expenses 45 45% Contribution

8) Data concerning Alonzo Corporation's single product appear below: Per Unit Percent of Sales Selling price $ 100 100% Variable expenses 45 45% Contribution margin $ 55 558 Version 1 4 Fixed expenses are $400,000 per month. The company is currently selling 8,000 units per month. Required: a) The marketing manager believes that an $20,000 increase in the monthly advertising budget would result in a 260 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change? b) How will this proposed change affect the contribution margin ratio? c) if this change is implemented what will be the new breakeven point? d) should Alonzo implement this change?

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