Answer:
Therefore, The overall effect would be that the net operating income per month will decrease by $1,700
Explanation:
According to the given data the Revised net selling price per unit = $140 - sales commission = $140 - 9 = $131 / unit
To calculate the overall effect on the company's monthly net operating income of this change we would make the following calculations:
Units sold                               8000                8100       Increase/ decrease
sales revenue $131 per unit       $ 1,120.000 $ 10,61,100     $ -58,900
Less: variable cost $28 per unit	$ 224,000  $ 2,26,800      $ 2,800
Contribution                             $ 8,96,000   $   8,34,300     $ -61,700
Fixed expense                   $   7,20,000   $ 6,60,000       $ -60,000
Net Operating Income           $   1,76,000   $   1,74,300     $ -1,700
Therefore, The overall effect would be that the net operating income per month will decrease by $1,700