4) 62%W,?Thu 2:35 PM Rami indow Help v2 lpng 2018 ??. CengageNoWv2 | Oeline teac

Question

4) 62%W,?Thu 2:35 PM Rami indow Help v2 lpng 2018 ??. CengageNoWv2 | Oeline teaching and learning resource from Ce Oifferential Analysis for Sales Promotion Proposal Sole Mates Ine. is planning a one-month campaign for July to promote sales of one of its two shoe products. A total of $145,000 has been budgeted for advertising, contests, redeemable coupons, and other promotional activities. The following data have been assembled for their possible usefulness in deciding which of the products to select for the campaign: Tennis Walking Shoes Shoes $67 $74 Unit seling price Unit production costs Direct materials Direct labor Variable factory overhead Fixed factory overhead $12 $16 Total unit production costs Unit variable selling expenses Unit fixed seling expenses $25 21 12 $58 $9 $33 20 $60 Total unit costs Operating income per une No increase in facilities would be necessary to produce or 19,000 additional units of walking $14 and sel the increased output. It is anticipated that 2 shoes could be sold from the campaign without changing the unit selling price of ether 3,000 additional units of tennis shoes Check My Work Previous F7

Explanation / Answer

Therefore, it is better to sell Promoting tennis shoes as it will give an incremental income of $70,000 over walking shoes

Promoting Tennis Shoes Promoting Walking Shoes Shoes Differential Effect on Income Revenue $               1,541,000 $              1,406,000 $                   135,000 Costs: Direct Materials $                   276,000 $                  304,000 $                   (28,000) Direct Labour $                     92,000 $                    95,000 $                     (3,000) Variable Factory Overheads $                     69,000 $                    76,000 $                     (7,000) Variable Selling Expenses $                   483,000 $                  380,000 $                   103,000 Sales promotion $                   145,000 $                  145,000 $                              -   Income(Loss) $                   476,000 $                  406,000 $                     70,000

Related Questions

Navigate

• Browse (All)
• Browse 4
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.