Question
Marshall Interiors, an interior design company, has experienced a drop in business due to an increase in interest rates and a corresponding slowdown in remodeling
Marshall Interiors, an interior design company, has experienced a drop in business due to an increase in interest rates and a corresponding slowdown in remodeling projects. To stimulate business, the company is considering exhibiting at the Middleton Home and Garden Expo. The exhibit will cost the company $15,080 for space. At the show, Marshall Interiors will present a slide show on a laptop, pass out brochures that were printed previously (the company printed more than needed), and show its portfolio of previous jobs.
The company estimates that revenue will increase by $39,710 over the next year as a result of the exhibit. For the previous year, profit was as follows:
Revenue $214,238
Less:
Design supplies $17,943
Salary of Samantha Spade (owner) $81,482
Salary of Kim Bridesdale (full-time employee) $55,523
Rent $19,142
Utilities $46,970
Depreciation of office equipment $4,120
Printing of advertising materials $869
Advertising inMiddleton Journal $3,240
Travel expenses other than depreciation of autos $3,110
Depreciation of company cars $10,990 $203,389
Net income $10,849
Calculate the impact of the exhibit on company profit.(Round intermediate calculations to 4 decimal places, e.g. 0.3215 and final answer to 0 decimal places, e.g. 125.)
Company profit willdecrease or increase?
Byhow much? $
The companyshould not or should exhibit at the home show?
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