Staley Co. manufactures computer monitors. The following is a summary of its basic cost and revenue data:           Per Unit       Percent   Sales price   $   530       100.00   Variable costs       337       63.58   Unit contribution margin   $   193       36.42                         Assume that Staley Co. is currently selling 650 computer monitors per month and monthly fixed costs are $80,500. If an $18,500 increase in the advertising budget would increase monthly sales by $60,500, the new level of operating income (πB) for Staley Co. would be: (Do not round intermediate calculations.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Staley Co. manufactures computer monitors. The following is a summary of its basic cost and revenue data:

 

        Per Unit       Percent  
Sales price   $   530       100.00  
Variable costs       337       63.58  
Unit contribution margin   $   193       36.42  
                   

 

Assume that Staley Co. is currently selling 650 computer monitors per month and monthly fixed costs are $80,500.

If an $18,500 increase in the advertising budget would increase monthly sales by $60,500, the new level of operating income (πB) for Staley Co. would be: (Do not round intermediate calculations.)

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