Question: Data for Hermann Corporation are shown below Per Unit Percent of Sales Selling price Variable expenses Contribution margin 90 63 27 100% 70 30 %
Data for Hermann Corporation are shown below Per Unit Percent of Sales Selling price Variable expenses Contribution margin 90 63 27 100% 70 30 % Fixed expenses are $30,000 per month and the company is selling 2,000 units per month Required: 1a. How -b. Should the advertising budget be increased? much will net operating income Increase (decrease) per month if the monthly advertising budget increases by $5,00 and monthly sales increase by $9,000 Per Unit Percent of Sales 8 Selling price 9 Variable expenses 10 Contribution margin 90 63 27 100 % 70 30% 12 13 14 Fixed expenses are $30,000 per month and the company is selling 2,000 units per month. 15 16 17 Required 18 19 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $5,000 and monthly sales increase by $9,000 20
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