Raner, Harris and Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company's most recent year is given: Office Total Company Chicago Minneapolis Sales $ 450, 000 1008 $ 150, 000 1008 $ 300 , 000 1008 Variable expenses 225, 000 50% 45, 000 308 180 , 000 608 Contribution margin 225, 000 508 105, 000 708 120, 000 408 Traceable fixed expenses 126, 000 288 78, 000 528 48 , 000 168 office segment margin 99, 000 228 $ 27, 000 18 8 $ 72, 000 248 Common fixed expenses not traceable to offices 63, 000 14% Net operating income $ 36,000 8 8 Exercise 6-17 (Static) Working with a Segmented Income Statement [LO6-4] Assume that Minneapolis' sales by major market are: Market Minneapolis Medical Dental Sales $ 300,000 1008 $ 200,000 1008 $ 100, 000 1008 Variable expenses 180 , 000 608 128, 000 648 52, 000 528 Contribution margin 120, 000 40 72, 000 368 18, 000 488 Traceable fixed expenses 33, 000 118 12, 000 68 21, 000 218 Market segment margin 87,000 298 $ 60,000 308 $ 27,000 278 Common fixed expenses not traceable to markets 15 , 000 58 office segment margin $ 72, 000 248 The company would like to initiate an intensive advertising campaign in one of the two market segments during the next month. The campaign would cost $5,000. Marketing studies indicate that such a campaign would increase sales in the Medical market by $40,00 or increase sales in the Dental market by $35,000. Required: . How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Medical Market? 2. How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Dental Market? 3. In which of the markets would you recommend that the company focus its advertising campaign? Complete this question by entering your answers in the tabs below. JUN 28 city