WSR Inc WSR Inc

Multiple Choice

WSR Inc. WSR Inc. sells a variety of drink and food products including potato chips and sodas. The segmented income statements for these two products are as follows:
WSR's management is considering a special advertising campaign that will run during a major sporting event. The advertising campaign is expected to cost $30,000 and only one product can be featured. In-house marketing studies show that the campaign could increase sales of the soda division by $200,000 or increase sales of the chips division by $275,000.
Refer to the WSR Inc. information above. Which of the following statements is true regarding which product the advertising campaign should feature?

A) Overall company profits will be higher by $45,000 if the campaign features chips rather than soda.
B) Overall company profits will be higher by $28,750 if the campaign features chips rather than soda.
C) Overall company profits will be higher by $13,750 if the campaign features chips rather than soda.
D) Overall company profits will be higher by $26,250 if the campaign features soda rather than chips.