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1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places. Hair-Again Marketing Expense Budget For the Year Ended December 31 Total Quarter 1 Quarter 2 Quarter 3 Quarter 4

1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places. Hair-Again Marketing Expense Budget For the Year Ended December 31 Total Quarter 1 Quarter 2 Quarter 3 Quarter 4

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Marketing Expense Budget Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used regularly for 45 days, will grow hair via the telephone and Internet. in bald spots (with varying degrees of success). Timothy calls his lotion Hair-Again and is selling His major form of marketing is through 15-minute infomercials and Internet advertising. Timothy sells each 16-ounce bottle of Hair- Again for $15 and pays a commission of 3 percent of sales to telephone operators who field the 1-800 phone calls from potential customers. Fixed marketing expenses for each quarter of the coming year include: Internet banner ads $7,500 Telephone operator time 4,000 Travel 2,000 In addition, early next year Timothy intends to film and show infomercials on television. He expects the cost to be $12,000 in quarters 1 and 2, and that the cost will rise to $24,000 in each of quarters 3 and 4. Timothy expects the following unit sales of Hair- Again: Quarter 1 5,000 Quarter 2 15,000 Quarter 3 40,000 Quarter 4 35,000 Required: 1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places. Hair-Again Marketing Expense Budget For the Year Ended December 31 Total Quarter 1 Quarter 2 Quarter 3 Quarter 4
Transcribed Image Text:Marketing Expense Budget Timothy Donaghy has developed a unique formula for growing hair. His proprietary lotion, used regularly for 45 days, will grow hair via the telephone and Internet. in bald spots (with varying degrees of success). Timothy calls his lotion Hair-Again and is selling His major form of marketing is through 15-minute infomercials and Internet advertising. Timothy sells each 16-ounce bottle of Hair- Again for $15 and pays a commission of 3 percent of sales to telephone operators who field the 1-800 phone calls from potential customers. Fixed marketing expenses for each quarter of the coming year include: Internet banner ads $7,500 Telephone operator time 4,000 Travel 2,000 In addition, early next year Timothy intends to film and show infomercials on television. He expects the cost to be $12,000 in quarters 1 and 2, and that the cost will rise to $24,000 in each of quarters 3 and 4. Timothy expects the following unit sales of Hair- Again: Quarter 1 5,000 Quarter 2 15,000 Quarter 3 40,000 Quarter 4 35,000 Required: 1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places. Hair-Again Marketing Expense Budget For the Year Ended December 31 Total Quarter 1 Quarter 2 Quarter 3 Quarter 4
Quarter 4 35,000 Required: 1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places. Hair-Again Marketing Expense Budget For the Year Ended December 31 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Total variable expense Fixed marketing expense: Total fixed expense Total marketing expense 2. What if the cost of internet ads rises to $16,000 in Quarters 2 through 4? How would that affect variable marketing expense? Fixed marketing expense? Total marketing expense? If no effect, enter "0" and select "no impact". Variable marketing expense Fixed marketing expense Total marketing expense
Transcribed Image Text:Quarter 4 35,000 Required: 1. Construct a marketing expense budget for Hair-Again for the coming year. Show total amounts by quarter and in total for the year. If required, round your answers to two decimal places. Hair-Again Marketing Expense Budget For the Year Ended December 31 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total Total variable expense Fixed marketing expense: Total fixed expense Total marketing expense 2. What if the cost of internet ads rises to $16,000 in Quarters 2 through 4? How would that affect variable marketing expense? Fixed marketing expense? Total marketing expense? If no effect, enter "0" and select "no impact". Variable marketing expense Fixed marketing expense Total marketing expense
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