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Kokomochi is considering the launch of an advertising campaign for its latest dessert product, the Mini Mochi Munch. Kokomochi plans to spend $ 6 .

Kokomochi is considering the launch of an advertising campaign for its latest dessert product, the Mini Mochi Munch. Kokomochi plans to spend
$6.1 million on TV, radio, and print advertising this year for the campaign. The ads are expected to boost sales of the Mini Mochi Munch by
$9.6 million this year and
$7.6 million next year. In addition, the company expects that new consumers who try the Mini Mochi Munch will be more likely to try Kokomochi's other products. As a result, sales of other products are expected to rise by
$1.6 million each year.
Kokomochi's gross profit margin for the Mini Mochi Munch is
36%, and its gross profit margin averages
20% for all other products. The company's marginal corporate tax rate is
35% both this year and next year. What are the incremental earnings associated with the advertising campaign?
Question content area bottom
Part 1
Complete the table below:(Round to the nearest dollar.)
Incremental Earnings Forecast
Year 1
Sales of Mini Mochi Munch
$
Other Sales
$
Cost of Goods Sold
$
Gross Profit
$
Selling, General, and Admin. Expenses
$
Depreciation
0
EBIT
$
Income tax at 35%
$
Unlevered Net Income
$

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