Marketing Expense Budget Timothy Donaghy has developed a unique formula for growing hair His proprietary lotion, used regularly for 45 days, will grow hair in bald spots (with varying degrees of success) Timothy calls his lotion Hair Again and is selling it via the telephone and Internet His major form of marketing is through 15 minute infomercials and Internet advertising Timothy sells each 16 ounce bottle of Hair Again for $15 and pays a commission of 3 percent of sales to telephone operators who field the 1 800 phone calls from potential customers Fixed marketing expenses for each quarter of the coming year include Internet banner ads $7,600 Telephone operator time 4,000 Travel 2,000 In addition, early next year Timothy intends to film and show infomercials on television He expects the cost to be $10,000 in quarters 1 and 2, and that the cost will rise to $25,000 in each of quarters 3 and 4 Timothy expects the following unit sales of Hair Again Quarter 1 5,000 Quarter 2 15,000 Quarter 3 40,000 Quarter 4 35,000 Required 1 Construct a marketing expense budget for Hair Again for the coming year Show total amounts by quarter and in total for the year If required, round your answers to two decimal places Hair Again Marketing Expense Budget For the Year Ended December 31 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Budgeted unit sales fill in the blank e0701506efd6038 2 fill in the blank e0701506efd6038 3 fill in the blank e0701506efd6038 4 fill in the blank e0701506efd6038 5 fill in the blank e0701506efd6038 6 Unit variable expense Total variable expense Fixed marketing expense Internet ads Television time Telephone operators Travel Total fixed expense Total marketing expense Feedback 2 What if the cost of internet ads rises to $16,000 in Quarters 2 through 4 How would that affect variable marketing expense Fixed marketing expense Total marketing expense If no effect, enter 0 and select no impact Variable marketing expense no impact Fixed marketing expense higher Total marketing expense higher

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Marketing Expense Budget Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used regularly for 45 days, will grow hair in

Marketing Expense Budget

Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used regularly for 45 days, will grow hair in bald spots (with varying degrees of success). Timothy calls his lotion Hair-Again and is selling it via the telephone and Internet. His major form of marketing is through 15-minute infomercials and Internet advertising. Timothy sells each 16-ounce bottle of Hair-Again for $15 and pays a commission of 3 percent of sales to telephone operators who field the 1-800 phone calls from potential customers. Fixed marketing expenses for each quarter of the coming year include:

Internet banner ads	$7,600
Telephone operator time	4,000
Travel	2,000

In addition, early next year Timothy intends to film and show infomercials on television. He expects the cost to be $10,000 in quarters 1 and 2, and that the cost will rise to $25,000 in each of quarters 3 and 4. Timothy expects the following unit sales of Hair-Again:

Quarter 1	5,000
Quarter 2	15,000
Quarter 3	40,000
Quarter 4	35,000

Required:

1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places.

Hair-Again
Marketing Expense Budget
For the Year Ended December 31
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Total

Budgeted unit sales	fill in the blank e0701506efd6038_2	fill in the blank e0701506efd6038_3	fill in the blank e0701506efd6038_4	fill in the blank e0701506efd6038_5	fill in the blank e0701506efd6038_6
Unit variable expense
Total variable expense
Fixed marketing expense:
Internet ads
Television time
Telephone operators
Travel
Total fixed expense
Total marketing expense

Feedback

2. What if the cost of internet ads rises to $16,000 in Quarters 2 through 4? How would that affect variable marketing expense? Fixed marketing expense? Total marketing expense? If no effect, enter "0" and select "no impact".