Memo To: Chief Development Officer From: Chief Executive Officer Re: 20X2 Profit Planning ABC Company I'm working on the 20X2 budget and I would like your input on possible expansion into new locations. As you know, we're currently operating out of one location and I'm wondering if expanding will help increase our profits. We've done some research and have the following estimates of the impact of expanding: Sales Assumptions Expansion per location will increase the number of units sold of each model by 30%. Selling, General and Administrative Expense Assumptions EXPENSES UTILITIES, MAINTENANCE AND FACILITIES $150,000 increase per location EXECUTIVE AND ADMIN SALARIES DEPRECIATION MARKETING AND PROMOTIONS $1,400,000 increase per new location $20,000 increase per new location 0.2% increase of total SHIPPING AND HANDLING COSTS sales per new location 0.1% increase of total sales per new location