Question: Infinity Designs, an interior design company, has experienced a drop in business due to an increase

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Question:

Infinity Designs, an interior design company, has experienced a drop in business due to an increase in interest rates and a corresponding slowdown in remodeling projects. To stimulate business, the company is considering exhibiting at the Home and Garden Expo. The exhibit will cost the company $12,000 for space. At the show, Infinity Designs will present a slide show on a PC, pass out brochures that are printed previously, (the company printed more than needed), and show its portfolio of previous jobs.

The company estimates that revenue will increase by $36,000 over the next year as a result of the exhibit. For the previous year, profit was as follows:

Required:

Calculate the impact of the exhibit on the company profit

Revenue		$201,000
Less:
Design supplies (varible cost)	$15,000
Salary of Samantha Spade (owneer)	80,000
Salary of Kim Brisdale (full time employee)	55,000
Rent	18,000
Utilities	6,000
Depreciation of office equipment	3,600
Printing of advertising materials	700
Advertising in Middleton Journal	2,500
Travel expenses other than depreciation of autos (variable cost)	$2,800
Depreciation of company cars	9,000