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Clinton Interiors, an interior design company, has experienced a drop in business due to an increase in interest rates and a corresponding slowdown in remodeling
Clinton Interiors, an interior design company, has experienced a drop in business due to an increase in interest rates and a corresponding slowdown in remodeling projects. To stimulate business, the company is considering exhibiting at the Middleton Home and Garden Expo. The exhibit will cost the company $14,910 for space. At the show, Clinton Interiors will present a slide show on a laptop, pass out brochures that were printed previously (the company printed more than needed), and show its portfolio of previous jobs. The company estimates that revenue will increase by $40,320 over the next year as a result of the exhibit. For the previous year, profit was as follows: Revenue $212,557 Less: Design supplies $18,026 Salary of Samantha Spade (owner) 82,165 Salary of Kim Bridesdale (full-time employee) 56,029 Rent 18,815 Utilities 6,400 Depreciation of office equipment 3,890 Printing of advertising materials 844 Advertising in Middleton Journal 3,180 Travel expenses other than depreciation of autos 3,070 Depreciation of company cars 9,370 201,789 Net income $10,768 Assume that design supplies and travel other than depreciation are variable costs. Calculate the impact of the exhibit on company profit. (Round intermediate calculations to 4 decimal places, e.g. 0.3215 and final answer to O decimal places, e.g. 125.) Company profit will by increase decrease Should the company exhibit at the home show? The company exhibit at the home show
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