Description of this paper

Ringstaff Corporation produces and sells a single...

Description

Solution


Question

Ringstaff Corporation produces and sells a single product. Data concerning that product appear below: per unit percent of sales selling price............... $150 100% variable expenses........... 30 20% contribution margin......... $120 80% The company is currently selling 7,000 units per month. Fixed expenses are $615,000 per month. The marketing manager believes that a $21,000 increase in the monthly advertising budget would result in a 180 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change? a.decrease of $21,000 b.decrease of $600 c.increase of $600 d.increase of $21,600

 

Paper#6100 | Written in 18-Jul-2015

Price : $25
SiteLock