The company is currently selling 8,000 units per month. Fixed expenses are $719,000 per month. The marketing manager believes that a $20,000 increase in the monthly advertising budget would result in a 180 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change

The following data is missing in the question which is being reproduced;

Selling price $140

Variable Cost $28

Contribution Margin $112

Explanation:

Increase in sale 180*140 $25,200

Variable Cost 180*28 ($5,040)

Net contribution margin $20,160

Advertising expense-incremental ($20,000)

Net Increase in operating income $160

The net operating income will increase with just $160 because of this change.