Question: Data for Hermann Corporation are shown below: Per Unit Percent of Sales Selling price $ 80 100 % Variable expenses 44 55 Contribution margin $

Data for Hermann Corporation are shown below:

	Per Unit		Percent of Sales
Selling price	$	80		100	%
Variable expenses		44		55
Contribution margin	$	36		45	%

Fixed expenses are $76,000 per month and the company is selling 2,500 units per month.

rev: 06_04_2020_QC_CS-205709, 06_18_2020_QC_CS-216765, 07_14_2020_QC_CS-216765

Required:

1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,100 and monthly sales increase by $14,400?

1-b. Should the advertising budget be increased?

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