For all responses, please remember that providing your qualitative (written) rationale can be just as important as your quantitative calculations. 1. Below is Batteries for Everyone's budgeted statement of comprehensive income for the year ending December 31, 2017: Batteries for EveryoneCanada Budgeted Statement of Comprehensive Income Legal Basis For the Year Ending December 31, 2017 (thousands of dollars) Alkaline Carbon Zinc Total Sales 95,000 15,000 110,000 Cost of Goods Sold 54,000 13,500 67,500 Gross Margin 41,000 1,500 42,500 Direct Overhead 21,500 900 22,400 Segment Contribution 19,500 600 20,100 Corporate Overhead 19,000 Operating Profit 1,100 Additional Information: In calculating the transfer price to Canada, the producing country marks up alkaline product by 25% and carbon zinc product by 5%. Canada's senior management receives a bonus based on hitting the budgeted operating profit. The base bonus of 10% of a senior manager's salary is paid for hitting the target profit. For every 1% that the actual profit exceeds budgeted profit, the senior manager receives an additional 1% of his or her salary up to a maximum of an additional 30% (i.e., the maximum bonus is 40% of a senior manager's salary). Assume Cost of Goods Sold is variable. If actual sales volume of alkaline batteries was 2% more than budgeted, what bonus would a senior manager receive if her salary was $100,000? Calculate this amount based upon (a) legal results and (b) market profitability reporting (i.e., transfer-pricing markups are removed from both the budget and actual results). Assume the sales mix in both segments is the same for both budget and actual.