Question: Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit Percent of Sales $ 110 77 100% 70 $

Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution

Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit Percent of Sales $ 110 77 100% 70 $ 33 30% Fixed expenses are $82,000 per month and the company is selling 3,500 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,700, the monthly sales volume increases by 100 units, and the total monthly sales increase by $11,000? 1-b. Should the advertising budget be increased?

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