Sam and dennys ice cream shop charges 165 for a cone

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Sam and Denny's ice cream shop charges $1.65 for a cone. Variable expenses are $0.35 per cone, and fixed costs total $2,400 per month. A "sweetheart" promotion is being planned for the second week of February. During this week, a person buying a cone at the regular price would receive a free cone for a friend. It is estimated that 775 additional cones would be sold and that 975 cones would be given away. Advertising costs for the promotion would be $130.

Calculate the effect of the promotion on operating income for the second week of February. (Round your answer to 2 decimal places.

Reference no: EM13597880

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