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Data concerning Runnells Corporation's single and sells a product. Data co cerning that product appear below:

	Per Unit	Percent of Sales
Selling price	$150	100%
Variable expenses	75	50%
Contribution margin	$ 75	50%

The company is currently selling 4,800 units per month. Fixed expenses are $302,600 per month. The marketing manager believes that a $7,200 increase in the monthly advertising budget would result in a 210 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9962989

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