Physical production of Golden Grow is based on contract agreements. These costs include the price of materials, labor, and overhead. We purchase our printed bags and canisters from a plastics manufacturer and distribute these to the contractors. Total operating expenses include administrative expenses and marketing expenses. About three-fifths of operating expense is dedicated to promotions, while roughly a third is allocated to the sales force.
Administrative expense is the remainder.
Since transportation is handled by contract freight haulers, there are no distribution expenses in the income statement. The projected income statement shows that Golden Grow will be a profitable product. Return on investment exceeds objectives over the three-year period. The objectives and goals set forth in our business proposition must be constantly assessed in order to give an accurate picture of our current position and to give us direction for further endeavors. The business proposition sets several goals to be achieved and establishes appropriate time frames for these goals.