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Below is a variable costing income statement for Wilner Glass Company, a maker of bottles for the beverage industry. For the coming year, the company is considering hiring 3 additional sales representatives at $78,400 each for base salary plus 4 percent of their sales for commissions. The company anticipates that each sales representative will generate $883,000 of incremental sale.

Wilner Glass Company Income Statement For the Year Ending December 31, 2014
Sales			$20,120,000
Less:
	Variable cost of goods sold	$8,249,200
	Variable selling expense	4,225,200	12,474,400
Contribution margin			7,645,600
Less:
	Fixed production expense	2,584,100
	Fixed selling expense	1,788,400
	Fixed administrative expense	2,944,200	7,316,700
Net income			$328,900

Calculate the impact on profit of the proposed hiring decision should the company hire the two additional sales representatives?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9965964

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