Shown as follows are responsibility income statements for Butterfield, Inc., for the month of March. Sales Variable costs Contribution margin Fixed costs traceable to divisions Division responsibility margin Common fixed costs Income from operations Investment Centers Butterfield, Inc Division 1 Division 2 Dollars $ Dollars $ Dollars $ 520,000 100.00% $ 340,000 100% $ 180,000 100% 258,000 49.62 204,000 60 54,000 $ 262,000 50.38% $ 136,000 40% $ 126,000 157,800 30.35 7 1,400 21 86,400 $ 104,200 20.04% $ 64,600 198 $ 39,600 50,000 9.62 $ 54,200 10.42% Sales Variable costs Contribution margin Fixed costs traceable to products Product responsibility margin Common fixed costs Responsibility margin for division Division 1 Dollars $ 340,000 100% 204,000 60 $ 136,000 40$ 47,600 14 $ 88,400 26% 23,800 $ 64,600 Profit Centers Product A Dollars $ 136,000 100.00% 61,200 45.00 $ 74,800 55.00$ 14, 280 10.50 $ 60,520 44.50% Product B Dollars $ 204,000 100.00% 142,800 70.00 $ 61,200 30.00% 33,320 16.33 $ 27,880 13.67% Required: a. The company plans to initiate an advertising campaign for one of the two products in Division 1. The campaign would cost $4,000 per month and is expected to increase the sales of whichever product is advertised by $30,000 per month. Compute the expected increase in the responsibility margin of Division 1 assuming that (1) product A is advertised and (2) product B is advertised. e. Prepare an income statement for Butterfield, Inc., by division, under the assumption that in April the monthly sales in Division 2 increase to $200,000