Required information SB Exercise 7-16 through Exercise 7-17 (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 $ 504,000 1000 252,000 500 252,000 54 141, 120 289 110,880 224 70,560 14% $ 40,320 89 Office Chicago Minneapolis $ 177,000 100% $ 327,000 1001 53, 100 30 196, 200 604 123, 900 70 139,800 40 92,040 529 52,320 16 $ 31,860 189 $ 78,480 24% cise 7-17 (Algo) Working with a Segmented Income Statement (L07-4) ne that Minneapolis' sales by major market are: Market Required information Assume that Minneapolis' sales by major market are: Sales Variable expenses Contribution margin Traceable fixed expenses Office segment margin Common fixed expenses not traceable to offices Net operating income 36 Market Medical Dental $ 236,000 100% $ 136,000 100% 151,040 649 70,720 52% 84,960 65,280 48% 14,160 6% 28,560 214 $ 70,800 304 $ 36,720 27% Minneapolis $ 327,000 100% 196,200 604 130,800 40% 52,320 16% 78,480 24% 15,000 5% $ 63, 480 19 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 $14,000. Marketing studies indicate that such a campaign would increase sales in the Medical market by $58,000 or increase sales in the Dental market by $62,000. 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. 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 legile Required 2 > 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 Dental Market? Company's profits by Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 In which of the markets would you recommend that the company focus its advertising campaign? Medical Dental