Business, 18.03.2020 20:23, normarismendoza

Kokomochi is considering the launch of an advertising campaign for its latest dessert product, the Mini Mochi Munch. Kokomochi plans to spend $ 6.5 million on TV, radio, and print advertising this year for the campaign. The ads are expected to boost sales of the Mini Mochi Munch by $ 10.1 million this year and $ 8.1 million next year. In addition, the company expects that new consumers who try the Mini Mochi Munch will be more likely to try Kokomochi's other products. As a result, sales of other products are expected to rise by $ 2.1 million each year. Kokomochi's gross profit margin for the Mini Mochi Munch is 34 %, and its gross profit margin averages 23 % for all other products. The company's marginal corporate tax rate is 35 % both this year and next year. What are the incremental earnings associated with the advertising campaign?

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Kokomochi is considering the launch of an advertising campaign for its latest dessert product, the M...