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Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as...

Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales $ 1,648,000 Variable expenses 706,780 Contribution margin 941,220 Fixed expenses 1,035,000 Net operating income (loss) $ (93,780) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division East Central West Sales $ 438,000 $ 700,000 $ 510,000 Variable expenses as a percentage of sales 51 % 37 % 44 % Traceable fixed expenses $ 288,000 $ 322,000 $ 205,000 Required: . 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $25,000 based on the belief that it would increase that division's sales by 14%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented?

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