operating income

Required information Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L06-4) [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $105 63 $ 42 Percent of Sales 1008 60 401 Fixed expenses are $81,000 per month and the company is selling 3,800 units per month. Exercise 6-5 Part 2 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $4 per unit and increase unit sales by 20%. 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Reg 2A Reg 2B 8 Contribution margin $ 42 400 Fixed expenses are $81,000 per month and the company is selling 3,800 units per month. Exercise 6-5 Part 2 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $4 per unit and increase unit sales by 20% 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Req 2A Reg 2B Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher- quality components that increase the variable expense by $4 per unit and increase unit sales by 20% increases by Net operating income Req 2B> Fixed expenses are $81,000 per month and the company is selling 3,800 units per month. Exercise 6-5 Part 2 2-a. Refer to the original data. How much will net operating income Increase (decrease) per month if the company uses higher quality components that increase the variable expense by $4 per unit and increase unit sales by 20% 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Reg 2A Real Should the higher-quality components be used? Yes ONO