Required information SB Exercise 6-16 through Exercise 6-17 (Algo) [The following information applies to the questions displayed below.) Raner, Harris & 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: Sales Variable expenses Contribution margin Traceable fixed expenses Office segment margin Common fixed expenses not traceable to offices Net operating income Total Company $ 478,000 100% 237,600 50% 240,400 50% 135,520 28% 104,880 22% 66,920 14% $ 37,960 8% Office Chicago Minneapolis $ 164,000 100% $ 314,000 100% 49,200 30% 188,400 60% 114,800 70% 125,600 40% 85,280 52% 50,240 16% $ 29,520 18% $ 75,360 24% Exercise 6-17 (Algo) Working with a Segmented Income Statement (LO6-4] Assume that Minneapolis' sales by major market are: Sales Variable expenses Contribution margin Traceable fixed expenses Market segment margin Common fixed expenses not traceable to markets Office segment margin Minneapolis $ 314,000 100% 188,400 60% 125,600 40% 34,540 11% 91,060 29% 15,700 5% $ 75,360 24% Market Medical Dental $ 228,000 100% $ 128,000 100% 145,920 64% 66,560 52% 93,000 36% 61,440 48% 13,680 6% 26,880 21% $ 68,400 30% $ 34,560 27% 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 $12,000. Marketing studies indicate that such a campaign would increase sales in the Medical market by $54,000 or increase sales in the Dental market by $56,000. Required: 1. 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. Required 1 Required 2 Required 3 How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Medical Market? Company's profits by Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Dental Market? Company's profits by
