Advisory opinion letter to Ms. Claffey

ADVISORY OPINIONS 1845 figure and determine their status in regard to each category of expense. For example, materials used might represent 40% of Sales; Officers Salaries may be 20% of Sales, etc.

Before proceeding with such a proposal it is, of course, necessary to determine if this plan is in violation of any FTC Guidelines and would be permissible.

A copy of the financial format is enclosed. Any assistance you can render will be greatly appreciated.

_Yours very truly,
James B. Levine
GROSS SALES $
Less Returns & Allowances
Less Freight Allowances
Net Sales
COST OF SALES
a. Total Materials Used
b. Direct & Indirect Labor
c. Fringe Benefits
d. Manufacturing Expenses
e. Inventory Adjustment
Total Cost of Sales
GROSS PROFIT ON SALES
ADMINISTRATIVE EXPENSES
Officers Salaries
Office Salaries
All Other Administrative Expenses
Total Administrative Expenses
SELLING EXPENSES
Salesmensg’ Salaries
Commissions
Travel and Entertainment
All Other Selling Expenses
Total Selling Expenses
NET PROFIT FROM OPERATIONS
Other Income and Expense
NET PROFIT BEFORE TAXES

Option of refund or substitute publication to subscribers to a magazine that has never been published. (File No. 743 7006,

Digest 489)
% Opinion Letter
March 4, 1974
Dear Ms. Claffey:

This letter is in response to your letter of January 28, 1974, request

1846 FEDERAL TRADE COMMISSION DECISIONS
83 F.T.C.
ing an advisory opinion from the Commission.

It is the Commission’s understanding that North American Publishing Company, publishers of “Media and Methods,” will send the attached letter to all subscribers of “Involvement.” By virtue of the letter, you propose to offer all subscribers of “Involvement” the choice of one year of “Media and Methods” (or one year extension of a present subscription to “Media and Methods”) or a refund to be obtained from the publishers of “Involvement.”

The Commission would not initiate proceedings against North American Publishing Company if each subscriber is given the opportunity to communicate directly to you his choice between a refund and a subscription to “Media and Methods.” All subscribers should have a reasonable time in which to make an election (at least three weeks); those subscribers who make no election within the required time should be deemed to

have elected to receive a refund.
By direction of the Commission.
Letter of Request
January 23, 1974