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How do calculate the operating income for each options

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Reference no: EM132755724

Blake is evaluating two options to increase the number of mascots sold next month. First, he believes he can increase sales by advertising in the university newspaper. Blake can purchase a package of 12 ads over the next month for a total of $1,500. He believes the ads will increase the number of stuffed mascots sold from 1,500 to 2,200. A second option would be to reduce the selling price. Blake believes a 15% decrease in the price will result in 2,400 mascots sold.

Problem 1: Calculate the operating income for each options?

Problem 2: Which plan should Blake implement?

Problem 3: At what level of sales would he be indifferent between the two plans?

Reference no: EM132755724

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