Exercise 6-17 (Algo) Working with a Segmented Income Statement (LO6-4] Assume that Minneapolis' sales by major market are: Sales Variable expenses Contribution margin Traceable fixed expenses Market segment margin Common fixed expenses not traceable to markets Office segment margin 64% Market Medical Dental $ 232,000 100% $ 132,000 100% 148, 480 68,640 52% 96,000 36% 63,360 48% 13,920 6% 27,720 21% $ 69,600 30% $ 35,640 27% Minneapolis $ 316,000 100% 189,600 60% 126,400 40% 34,760 11% 91,640 29% 15,800 5% $ 75,840 24% The company would like to initiate an intensive advertising campaign in one of the two market segments during the next month. The campaign would cost $13,000. Marketing studies indicate that such a campaign would increase sales in the Medical market by $56,000 or increase sales in the Dental market by $59,000. Required: 1. How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Medical Market? 2. How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Dental Market? 3. In which of the markets would you recommend that the company focus its advertising campaign? How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Medical Market? Company's profits by How much would the company's profits increase (decrease) if it implemented the advertising campaign in the Dental Market? Company's profits by In which of the markets would you recommend that the company focus its advertising campaign? Medical Dental