Integrative Cases $1-59($Algo$)$ Cost Data for Managerial Purposes$-$Finding Unknowns $($LO $1-3)$

Miller Cereals is a small milling company that makes a single brand of cereal. Recently, a business school intern

recommended that the company introduce a second cereal in order to "diversify the product portfolio." Currently, the

company shows an operating profit that is $20$ percent of sales. With the single product, other costs were twice the cost of

rent.

The intern estimated that the incremental profit of the new cereal would only be $5\mathrm{.}5$ percent of the incremental revenue, but it

would still add to total profit. On his last day, the interiy told Miller's marketing manager that his analysis was on the company

laptop in a spreadsheet with a file name, NewProduct.xlsx$.$ The intern then left for a $12-$month walkabout in the outback of

Australia and cannot be reached.

When the marketing manager opened the file, it was corrupted and could not be opened. She then found an early

$($incomplete$)$ copy on the company's backup server. The marketing manager then called a cost management accountant in the

controller's office and asked for help in reconstructing the analysis indicated in the accompanying incomplete spreadsheet.

Required:

As the management accountant, fill in the blank cells. $($Do not round intermediate calculations. Round your final answers to

the nearest whole number. Enter all amounts as positive values.$)$

$\backslash$table$[[$Miller Cereals$],[$Projected Income Statement$],[$For One Year$],[,$Status Quo: Single Product,$\%$ Increase $($Decrease$),$Alternative: Two Products,Difference$],[$Sales revenue,,$40,\%,,$$$,76,000],[$Costs$],[$Material$,56,000,,\%,68,000,,],[$Labor$,,20,\%,68,000,,],[$Rent$,,50,\%,,,],[$Depreciation$,9,600,,\%,9,600,,],[$Utilities$,,,\%,6,600,,1,800],[$Other$],[$Total costs,,,,,,$],[$Operating profit,,,$\%,,,]]$