### Fiexed expenses are 293000 per month the company is

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Vacaro corporation produces and sells a single prodcut . Data concerning appears below.

• Per Unit Percent of sales
• Selling price 140 100%
• Variable expenses 28 20%
• Contribution Margin \$112 80%

Fiexed expenses are \$293,000 per month. The company is currently selling 3000 units per month. Management is considering using a new component that would increase the unit variable cost by \$13. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effect on the company's monthly net operating income of this change?

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