Solution-What will be the revised net operating income or

What will be the revised net operating income or loss

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Reference no: EM132565300

Due to erratic sales of its sole product-a high-capacity battery for laptop computers-PEM, Inc., has been experiencing financial difficulty for some time. The company's contribution format income statement for the most recent month is given below:

Sales (12,700 units × $20 per unit) $ 254,000

Variable expenses 152,400

Contribution margin 101,600

Fixed expenses 113,600

Net operating loss $ (12,000 )

Problem 1: Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $38,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? (Losses should be entered as a negative value.)

Reference no: EM132565300

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What will be the revised net operating income or loss

Reference no: EM132565300

Reference no: EM132565300

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