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Data for Hermann Corporation are shown below: Per UnitPercent of SalesSelling price$ 125100%Variable expenses8064Contribution margin$...

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Accounting

Data for Hermann Corporation are shown below: Per UnitPercent of SalesSelling price$ 125100%Variable expenses8064Contribution margin$ 4536% Fixed expenses are $85,000 per month and the company is selling 2,700 units per month.Required:

1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,000, the monthly sales volume increases by 100 units, and the total monthly sales increase by $12,500?

1-b. Should the advertising budget be increased?

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