At Coffee Klatch the average selling price of a cup of coffee is $1.49, the average variable expense per cup is $0.36, the average fixed expense per month is $1,300 and an average of 2,100 cups are sold each month.
If sales increase by 20%, by how much should net operating income increase?
a. 30.0%
b. 20.0%
c. 22.1%
d. 44.2%