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
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
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
Marketing Expense Budget
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 in bald spots (with varying degrees of success). Timothy calls his lotion Hair-Again and is selling it via the
telephone and Internet. 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
$7,600
Telephone operator time
5,000
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 gquarters 1 and 2, and that the cost will rise to $25,000 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:
Transcribed Image Text: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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