Sales Variable costs Contribution margin Fixed costs traceable to divisions Division responsibility margin Common fixed costs Income from operations Investment Centers Butterfield, Inc Division 1 Dollars 5 f Dollars 8 $ 380,000 100.00% $ 250,000 100% 189,000 49.74 150,000 60 $ 191,000 50.26% $ 100,000 40% 114,900 30.24 52,500 21 $ 76,100 20.03% $ 47,500 19% 50,000 13.16 $ 26,100 6.87% Division 2 Dollars 8 $ 130,000 100% 39,000 30 $ 91,000 70% 62,400 48 $ 28,600 22% Sales Variable costs Contribution margin Fixed costs traceable to products Product responsibility margin Common fixed costs Responsibility margin for division Division 1 Dollars % $ 250,000 100% 150,000 60 $ 100,000 40% 35,000 14 $ 65,000 26% 17,500 7 $ 47,500 19% Profit Centers Product A Dollars 8 $ 100,000 100.00% 45,000 45.00 $ 55,000 55.00% 10,500 10.50 $ 44,500 44.50% Product B Dollars % $ 150,000 100.00% 105,000 70.00 $ 45,000 30.00% 24,500 16.33 $ 20,500 13.67% Required: a. The company plans to initiate an advertising campaign for one of the two products in Division 1. The campaign would cost $3,000 per month and is expected to increase the sales of whichever product is advertised by $40,000 per month. Compute the expected increase in the responsibility margin of Division 1 assuming that (1) product A is advertised and (2) product B is advertised. e. Prepare an income statement for Butterfield, Inc., by division, under the assumption that in April the monthly sales in Division 2 increase to $150,000. Complete this question by entering your answers in the tabs below. Required A Required E The company plans to initiate an advertising campaign for one of the two products in Division 1. The campaign would cost $3,000 per month and is expected to increase the sales of whichever product is advertised by $40,000 per month. Compute the expected increase in the responsibility margin of Division 1 assuming that (1) product A is advertised and (2) product B is advertised. Prepare an income statement for Butterfield, Inc., by division, under the assumption that in April the monthly sales in Division 2 increase to $150,000. (Round your percentage answers to 2 decimal place (i.e. 0.1234 should be considered as 12.34%).) Division 2 Dollars Percent Dollars BUTTERFIELD, INC. Responsibility Income Statement For April Butterfield, Inc. Division 1 Percent Dollars Percent % % % % % % % % % % % % % % % % % Required A Required E