finance-Kokomochi is considering the launch of an advertising campaign

QUESTION

problem for financeKokomochi is considering the launch of an advertising campaign for its latest dessert product, the Mini Mochi Munch. Kokomochi plans to spend $5.84 million on TV, radio, and print advertising this year for the campaign. The ads are expected to boost sales of the MiniMochi Munch by $11.07 million this year and by $9.07 million next year. In addition, the companyexpects that new consumers who try the Mini Mochi Munch will be more likely to tryKokomochi’s other products. As a result, sales of other products are expected to rise by $3.56 million each year.Kokomochi’s gross profit margin for the Mini Mochi Munch is 35%, and its gross profit margin averages 24% for all other products. The company’s marginal corporate tax rate is 33% both this year and next year. What are the incremental earnings associated with the advertising campaign?with the information given im unable to calculate the COGS not sure how to do this

 

ANSWER:

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