Differential Analysis Report for Sales Promotion Proposal Wedge Shoe Company is planning a one-month campaign for August to promote sales of one of its two shoe products. A total of $127,000 has been budgeted for advertising, contests, redeemable coupons, and other promotional activities. The following data have been assembled for their possible usefulness in deciding which of the products to select for the campaign: No increase in taclities would be necessary to produce and sell the increased output, it is antioipated that 26,000 additional units of dosed tee shoes or 22,000 additional units of open-toe shoes could be sold without changing the unit selling price of either product. 1. Prepare a differential analysis report presenting the additional revenue and additional costs anticipated from the promotion of closed-toe shoes and open-toe shoes. F Check My Work 1. Subtract the variable costs, including the promotion costs, from the revenues for each product, based on the proposed production. 2. The sales manager has tentatively decided to promote closed-toe shoes, estimating that operating income will increase by $71,000 (operating income of $198,000 (22,000 units $9 ) less promotion expenses $127,000]. The manager also believes that the selection of open-toe shoes will decrease operating income by $55,000 loperating income of $55,000 ( $7 operiting income per unit for 26,000 units), less promotion expenses of $127,0001. Should the sales manager's tentative decision be accepted or opposed? The sales manager's tentative decision should be The will contribute more to operating income than would be contributed by promoting the