Reference no: EM133187272

Question - Marx Interiors, 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 Middleton Home and Garden Expo. The exhibit will cost the company $15,040 for space. At the show, Marx Interiors will present a slide show on a laptop, pass out brochures that were printed previously (the company printed more than needed), and show its portfolio of previous jobs.

The company estimates that revenue will increase by $40,060 over the next year as a result of the exhibit. For the previous year, profit was as follows:

Revenue		$212,502
Less:
Design supplies	$17,876
Salary of Samantha Spade (owner)	82,147
Salary of Kim Bridesdale (full-time employee)	56,496
Rent	18,867
Utilities	7,120
Depreciation of office equipment	3,820
Printing of advertising materials	797
Advertising in Middleton Journal	3,060
Travel expenses other than depreciation of autos	3,260
Depreciation of company cars	10,040	203,483
Net income		$9,019

Assume that design supplies and travel other than depreciation are variable costs.

Required -

Calculate the impact of the exhibit on company profit.

Should the company exhibit at the home show?