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Required information

Exercise $6-7($Algo$)$ Changes in Variable Costs, Fixed Costs, Selling Price, and Unit Sales $[$LO$6-7]$

$[$The following information applies to the questions displayed below.$]$

Data for Hermann Corporation are shown below:

Fixed expenses are $$84,000$ per month and the company is selling $2,600$ units per month.

Exercise $6-7($Algo$)$ Part $1$

Required:

$1-$a$.$ How much will net operating income increase $($decrease$)$ per month if the monthly advertising budget increases by $$8,900,$ the

monthly sales volume increases by $100$ units, and the total monthly sales increase by $$12,000?$

$1-$b$.$ Should the advertising budget be increased?