Exhibits 5 and 6 document the financial evaluation of the Super project. Exhibit 5 is the summary appropriation request prepared to justify the project to management and to secure management's authorization to expend funds on a capital project. Exhibit 6 presents the backup backup detail. Cost of the market test was included as "other" expense in the first period, because a new product had to pay for its test market expense, even though this might be a sunk cost at the time capital funds were requested. The "Adjustments" item represented erosion of the Jell-o market and was calculated by multiplying the volume of erosion times a variable profit contribution. In the preparation of this financial evaluation form, costs of acquiring packaging machinery were included, but no cost was attributed to Jell-o agglomerator capacity to be used for the Super project, because the General Foods Foods Accounting and Financial Manual specified that capital project requests be prepared on an incremental basis
The incremental concept requires that project requests, profit projecting, and funds-employed statements include only items of income and expense and investment in assets which will be realized, incurred, or made directly as a result of, or are attributed to ,the new project.