Refer to the data in Exercise 6-16. Assume that Minneapolis' sales by major market

Data in Exercise 6-16

The company would like to initiate an intensive advertising campaign in one of the two market segments during the next month. The campaign would cost $5,000. Marketing studies indicate that such a campaign would increase sales in the Medical market by $40,000 or increase sales in the Dental market by $35,000.
Required:
1. How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Medical Market?
2. How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Dental Market?
3. In which of the markets would you recommend that the company focus its advertising campaign?
4. In Exercise 6-16, Minneapolis shows $48,000 in traceable fixed expenses. What happened to the $48,000 in this exercise?

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Market Minneapolis Medical Dental Sales Variable expenses. Contribution margin Traceable fixed expenses Market segment margin Common fixed expenses not traceable to markets Office segment margin $300,000 180,000 120,000 33,000 87,000 15,000 $ 72,000 100% 60% 40% 11% $200,000 128,000 72,000 12,000 29% $60,000 100% 64% 36% 6% 100% 52,000 52% 48,000 48% 21,000 21% 30% $27,000 27% $100,000 5% 24% Total Company Chicago Sales $450,000 100% $150,000 100% $300,000 100% 225,000 50% 45,000 30% 180,000 60% 225,000 50% 105,000 70% 120,000 40% 78,000 52% Traceable fixed expenses 48.000 16% Office segment margin. Common fixed expenses not traceable to offices.. 126,000 28% 99,000 22% $27,000 18% $72,000 24% 63,000 14% 8%