Shown as follows are responsibility income statements for Butterfield, Inc., for the month of March. Butterfield, Inc Dollars Investment Centers Division 1 Dollars 100.00% $ 340,000 51.70 204,000 48.30% $ 136,000 28.47 71,400 % Division 2 Dollars 100% $ 130,000 % 100% 60 39,000 30 40% $ 91,000 70% 21 62,400 48 $ 93,200 19.83% $ 64,600 19% $ 28,600 22% 50,000 10.64 $ 43,200 9.19% Sales Variable costs Contribution margin Fixed costs traceable to divisions Division responsibility margin Common fixed costs Income from operations $ 470,000 243,000 $ 227,000 133,800 Sales Variable costs Contribution margin Fixed costs traceable to products Product responsibility margin Common fixed costs Responsibility margin for division Required: Profit Centers Division 1 Product A Product B Dollars % Dollars % $ 340,000 204,000 100 % $ 136,000 Dollars 100.00% $ 204,000 % 100.00% 60 61,200 45.00 142,800 70.00 $ 136,000 40% $ 74,800 47,600 14 14,280 10.50 55.00% $ 61,200 33,320 30.00% 16.33 $ 88,400 23,800 $ 64,600 26% $ 60,520 44.50% $ 27,880 13.67% 7 19% a. The company plans to initiate an advertising campaign for one of the two products in Division 1. The campaign would cost $3,000 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. je. Prepare an income statement for Butterfield, Inc., by division, under the assumption that in April the monthly sales in Division 2 increase to $150,000