Boenisch Corporation produces and sells a single product with the following characteristics: Selling price......... Variable expenses...

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Boenisch Corporation produces and sells a single product with the following characteristics: Selling price......... Variable expenses Contribution margin.. Per Unit $170 102 $ 68 Percent of Sales 100% 60% 40% The company is currently selling 8,000 units per month. Fixed expenses are $406,000 per month. Management is considering using a new component that would increase the unit variable cost by $3. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effect on the company's monthly net operating income of this change? Boenisch Corporation produces and sells a single product with the following characteristics: Selling price......... Variable expenses Contribution margin.. Per Unit $170 102 $ 68 Percent of Sales 100% 60% 40% The company is currently selling 8,000 units per month. Fixed expenses are $406,000 per month. Management is considering using a new component that would increase the unit variable cost by $3. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effect on the company's monthly net operating income of this change?

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To determine the overall effect on the companys monthly net operating income of using the new compon... View the full answer