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S . L . Brown and Company, a manufacturer of quality handmade walnut bowls, has had a steady growth in sales for the past 5
SL Brown and Company, a manufacturer of quality handmade walnut bowls, has had a steady growth in sales for the past years. However, increased competition has led Mr Brown, the
president, to believe that an aggressive marketing campaign will be necessary next year to maintain the company's present growth. To prepare for next year's marketing campaign, the
company's controller has prepared and presented Mr Brown with the following data for the current year, :
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Data table
What is the projected net income for
What is the breakeven point in units for
Mr Brown has set the revenue target for at a level of $or bowls
He believes an additional marketing cost of $ for advertising in with all other
costs remaining constant, will be necessary to attain the revenue target. What is the net
income for if the additional $ is spent and the revenue target is met?
What is the breakeven point in revenues for if the additional $ is spent for
advertising?
If the additional $ is spent, what are the required revenues for net
income to equal net income?
At a sales level of units, what maximum amount can be spent on advertising if a
net income of $ is desired?
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