Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Multicolumn Journal

Authors: Claudia Gilbertson

11th Edition

1337565423, 9781337565424

More Books

Students also viewed these Accounting questions

Question

The fear of making a fool of oneself

Answered: 1 week ago

Question

Annoyance about a statement that has been made by somebody

Answered: 1 week ago