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Diffical Analysis for Sales Promotion Proposal Has Cometic Company is planning a one-month campaign for March to promote sales of one of its two
Diffical Analysis for Sales Promotion Proposal Has Cometic Company is planning a one-month campaign for March to promote sales of one of its two cotics products. A total of $200,000 has been budget for advertising, contests, redeemable coupons, and other promotional activities. The fitowing data have been assembled for their possible usefulness in deading which of the products to select for the campaign Moisturizer Perfume Unit selling price $15 $24 Unit production costs: Direct materials 5(2) 1(4) Direct labor (2) (4) Variable factory overhead (1) (2) Fixed factory overhead (2) (6) Total unit production $(7) (16) cost Unit variable selling expenses (3) (2) Unit fixed selling expenses (1) (3) Total unit costs 5(9) $6 3(21) $3 Operating income per unit No increase in facilities would be necessary to produce and sell the increased output. It is anticipated that 75,000 additional units of moisturizer or 60,000 additional units of perfume could be sold from the campaign without changing the unit selling price of either product. Required: 1. Prepare a differential analysis as of February 17 to determine whether to promote moisturizer (Alternative 1) or perfume (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate a los Differential Analysis Promote Moisturizer (Alt. 1) or Promote Perfume (Alt. 2) Line Item Description Revenues Costs February 17 Promote Moisturizer Promote Perfume Differential Effects (Alternative 1) (Alternative 2) (Alternative 2) Direct materials Direct labor Variable factory overhead Variable selling expenses 10000 Nex
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