Question
Runner Interiors, an interior design company, has experienced a drop in business due to an increase in interest rates and a corresponding slowdown in remodeling
Runner 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 $14,990 for space. At the show, Runner 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 $40,020 over the next year as a result of the exhibit. For the previous year, profit was as follows:
Revenue | $213,151 | ||||
Less: | |||||
Design supplies | $17,922 | ||||
Salary of Samantha Spade (owner) | 81,323 | ||||
Salary of Kim Bridesdale (full-time employee) | 55,550 | ||||
Rent | 18,912 | ||||
Utilities | 6,810 | ||||
Depreciation of office equipment | 3,660 | ||||
Printing of advertising materials | 871 | ||||
Advertising in Middleton Journal | 2,740 | ||||
Travel expenses other than depreciation of autos | 3,140 | ||||
Depreciation of company cars | 10,330 | 201,258 | |||
Net income | $11,893 |
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 will Increase or Decrease? By____________
Should the company exhibit at the home show?
The company Should or Should not? exhibit at the home show.
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