Montclair Company earns an average contribution margin ratio of 40% on its sales. The local store manager estimates that he can increase monthly sales volume by $45,000 by spending an additional $7,000 per month for direct mail advertising. Compute the monthly increase in operating income if the manager's estimate about the increased sales volume is accurate.(a) $11,000.(b) $23,000.(c) $16,000.(d) $18,000.

Respuesta :

Answer:

(a). $11,000

Explanation:

$45,000 x 40% = $18,000

$18,000 - $7,000 = $11,000

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