Reference no: EM132640190

Runner 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 $15,140 for space. At the show, Runner 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 $39,850 over the next year as a result of the exhibit. For the previous year, profit was as follows:

Revenue $212,499
Less:Design supplies $17,941
Salary of Samantha Spade (owner) 81,247
Salary of Kim Bridesdale (full-time employee) 56,005
Rent 19,133
Utilities 6,780
Depreciation of office equipment 3,690
Printing of advertising materials 773
Advertising in Middleton Journal 2,830
Travel expenses other than depreciation of autos 2,990
Depreciation of company cars 10,140 201,529
Net income $10,970

Problem 1: Calculate the impact of the exhibit on company profit. (Round intermediate calculations to 4 decimal places, e.g. 0.3215 and final answer to 0 decimal places, e.g. 125.)

Problem 2: Should the company exhibit at the home show?