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What would be company''s net operating income

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Question - Bismarck Corporation has a single product whose selling price is $19. At an expected sales level of $1,840,000, the company's variable expenses are $560,000 and its fixed expenses are $300,000. The marketing manager has recommended paying a sales commission of 2% of sales to salespersons instead of paying them a fixed salary of $30,000. The company expects this change will increase unit sales by 5%.

What would be company's net operating income if the marketing manager's recommendation is adopted?

A) 660,000

B) 659,600

C) 676,080

D) 706,080

E) 717,840

Please show detailed help with steps and answer. Thanks.

Reference no: EM132067229

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