Data concerning Wislocki Corporation's single product appear below: per unit selling price $190 Percent of sales 100% Variable expenses per unit 38 Percent of sales 20% Contribution margin per unit $152 percent of sales 80% Fixed expenses are $1,039,000 per month. The company is currently selling 9800 units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $13 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $107,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 360 units. What should be the overall effect on the company's monthly net operating income of this change?
Data concerning Wislocki Corporation's single product appear below: per unit selling price $190 Percent of sales 100% Variable expenses per unit 38 Percent of sales 20% Contribution margin per unit $152 percent of sales 80% Fixed expenses are $1,039,000 per month. The company is currently selling 9800 units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $13 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $107,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 360 units. What should be the overall effect on the company's monthly net operating income of this change?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Data concerning Wislocki Corporation's single product appear below: per unit selling price $190 Percent
of sales 100% Variable expenses per unit 38 Percent of sales 20% Contribution margin per unit $152
percent of sales 80%
Fixed expenses are $1,039,000 per month. The company is currently selling 9800 units per month.
The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The
marketing manager has proposed a commission of $13 per unit. In exchange, the sales staff would accept
an overall decrease in their salaries of $107,000 per month. The marketing manager predicts that
introducing this sales incentive would increase monthly sales by 360 units. What should be the overall
effect on the company's monthly net operating income of this change?
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