A$.$ The company plans to intiatw an advertising campaign for one of the two products in division $1.$ The campaign will be cost $$10,000$ per month and is expected to increase the sale of whichever product is advertised by $$30,000$ per month. Compute the expected increase in our responsibility margin of Division $1$ assuming that $(1)$ product A is advertised and $(2)$ that product B is advertised.

B$.$ Assume at the sales are both products by division $1$ are equal to the total manufacture capacity. To increase sales of either product, the company must increase manufacturing facilities, which means an increase in traceable fixed cost in approximate proportion to the expected increase in sales. In this case, which product line would you recommend expanding? Explain.

C$.$ The income statement for division one includes $$21,000$ in common fix cost. What happens he fixed costs in the income statement for Butterfield, Inc.?

D$.$ Assume that in April the monthly sale in division two increased to $$200,000.$Compute the expected effect of this change on the operating income of the company $($assume no other changes in revenue or cost behavior$).$

E$.$ Prepare an income statement for Butterfield, inc., by division, under the assumption stated in part D$.$organizes income statement in the format illustrated, include comms for percentages.PROBLEM $22\mathrm{.}5$A

Analysis of Responsibility Income Statements

The following are responsibility income statements for Butterfield, Inc., for the month of March.

$\backslash$table$[[,$Investment Centers$],[,$Butterfleld, Inc.,Division $1,$Dil $,\backslash$table$[[\%$