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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 $ 5 .

Kokomochi is considering the launch of an advertising campaign for its latest dessert product, the Mini Mochi Munch. Kokomochi plans to spend $5.5 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 $10.2 million this year and $8.2 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 $1.5 million each year.
Kokomochi's gross profit margin for the Mini Mochi Munch is 37%, and its gross profit margin averages 21% for all other products. The company's marginal corporate
tax rate is 21% both this year and next year. What are the incremental earnings associated with the advertising campaign?
Complete the table below: (Round to the nearest dollar.)
Incremental Earnings Forecast
Sales of Mini Mochi Munch
Other Sales
Cost of Goods Sold
Gross Profit
Selling, General, and Admin. Expenses
Depreciation
Year 1
$
Year 2
$
0
0
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