Question

AFB Systems is considering a new marketing campaign that will require the addition of a new computer programmer and new software. The programmer will occupy an office in​ AFB's current building and will be paid​ $8,000 per month. The software license costs​ $1,000 per month. The rent for the building is​ $4,000 per month.​ AFB's computer system is always​ on, so running the new software will not change the current monthly electric bill of​ $900. The incremental expenses for the new marketing campaign are_____.

Answer 1

The incremental expenses include: $8000 per month being programmer's salary, $1000 per month being software license cost.

Step-by-step explanation:

Incremental cost refers to additional cost of investment. Here, rent for the building will still be paid for even if the software was not purchased. Also, the electric bill of $900 will always be paid even if the investment in software is not done.