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Exercise 6.5 (Algo) Changes in Variable Costs, Fixed Costs, Selling Price, a [The following information...

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Accounting

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Exercise 6.5 (Algo) Changes in Variable Costs, Fixed Costs, Selling Price, a [The following information applies to the questions displayed below] Data for Hermann Corporation are shown below: Fixed expenses are $81,000 per month and the company is selling 3,800 units per month. Exercise 6-5 (Algo) Part 2 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-qualit 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. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higherquality components that increase the variable expense by $4 per unit and increase unit sales by 20%

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