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The Variable Speed Company manufactures a line of high quality tools. The company sold 1,000,000 hammers at a price of $4 per unit last year. The company estimates that this volume represents a 20% share of the current hammers market. The market is expected to increase by 5%. Marketing specialists have determined that, as a result of a new advertising campaign and packaging, the company will increase its share of this larger market to 24%. Due to changes in prices, the new price for the hammer will be $4.30 per unit. This new price is expected to be in line with the competition and have no effect on the volume estimates. What are the estimated sales revenues in the coming year?   Multiple Choice   $5,040,000.   $5,160,000.   $5,418,000.   $5,689,000.

Ethel Company manufactures and sells desk lamps for hotel and motel rooms. Last year, it sold 120,000 units of its model Y lamp for $45 per unit. The company estimates that this volume represents a 24 percent share of the current market. The market is expected to increase by 8 percent next year. Marketing specialists have determined that as a result of new competition, the company's market share will fall to 20 percent (of this larger market). Due to changes in production costs and competitive models, the new price for the lamps will be $48 per unit. The revised volume estimates are based on the $48 price. Required: Estimate Ethel Company's sales revenues from model Y lamps for the coming year.

The following data refer to the Daniels division of Tippett Inc. Daniels sells variable- speed drills. The standard drill sells for $ 40, and Daniels plans to sell 30,000 units in 2017. Tippett treats Daniels as an investment center with a total attributable investment of $ 800,000. Daniels' annual fixed costs are $ 200,000. Variable cost per standard drill is $ 24. The firm's required rate of return on investment is 15%. 1.1 What is the expected Return on Investment in 2017? 1.2 What is the expected residual income for Daniels in 2017? A special order from a unit of the US Government has been received to buy from Daniel 10,000 units every year of the device at the price of $30 each. If the order is accepted, Daniels will have to incur additional annual fixed costs of $30,000 for administration and $150,000 to modify and expand the manufacturing facilities. 1.3 Based on the effect on ROI and/or Residual Income for the first year , will the manager accept this order? Why and why not?

Larson, Inc., manufactures backpacks. Last year, it sold 85,000 of its basic model for $25 per unit. The company estimates that this volume represents a 20 percent share of the current market. The market is expected to increase by 15 percent next year. Marketing specialists have determined that as a result of new competition, the company's market share will fall to 16 percent (of this larger market). Due to changes in prices, the new price for the backpacks will be $22 per unit. This new price is expected to be in line with the competition and have no effect on the volume estimates. Required: Estimate Larson's sales revenues from this model of backpack for the coming year. Sales revenue

Relling Corporation manufactures a drink bottle, model CL24. During 2017, Relling produced 210,000 bottles at a total cost of $808,500. Kraff Corporation has offered to supply as many bottles as Relling wants at a cost of $3.75 per bottle. Relling anticipates needing 225,000 bottles each year for the next few years. Q. Relling’s cost analyst uses annual data from past years to estimate the following regression equation with total manufacturing costs of the drink bottle as the dependent variable and drink bottles produced as the independent variable:y = $445,000 + $1.75XDuring the years used to estimate the regression equation, the production of bottles varied from 200,000 to 235,000. Using this equation, estimate how much it would cost Relling to manufacture 225,000 drink bottles. How much more or less costly is it to manufacture the bottles than to acquire them from Kraff?

Relling Corporation manufactures a drink bottle, model CL24. During 2017, Relling produced 210,000 bottles at a total cost of $808,500. Kraff Corporation has offered to supply as many bottles as Relling wants at a cost of $3.75 per bottle. Relling anticipates needing 225,000 bottles each year for the next few years. Q. What is the average cost of manufacturing a drink bottle in 2017? How does it compare to Kraff’s offer?

R. Fong Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $ 2 reduction in the selling price. The company's present selling price is $ 70 per unit, and variable expenses are $ 40 per unit. Fixed expenses are $ 540,000 per year. The present annual sales volume (at the $70 selling price) is 15,000 units. Assuming that the marketing studies are correct, what will be the optimal selling price that will give the maximum profit for the company? the optimal selling price is set, how many units are expected to be sold?

Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company’s present selling price is $91 per unit, and variable expenses are $61 per unit. Fixed expenses are $832,500 per year. The present annual sales volume (at the $91 selling price) is 25,100 units.   Required: 1. What is the present yearly net operating income or loss? 2. What is the present break-even point in unit sales and in dollar sales? 3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit? 4. What would be the break-even point in unit sales and in dollar sales using the selling price you determined in (3) above (e.g., the selling price at the level of maximum profits)?

Sk8 Company produces skateboards and purchases 20,000 units of a wheel bearing each year at a cost of $1 per unit. Sk8 requires a 15% annual rate of return on investment. In addition, the relevant carrying cost (for insurance, materials handling, breakage, etc.) is $0.17 per unit per year. The relevant ordering cost per purchase order is $38.40. Q. Assume that demand is uniform throughout the year and known with certainty so there is no need for safety stocks. The purchase-order lead time is half a month. Calculate Sk8’s reorder point for the wheel bearing.

Computate Inc. produces microprocessors for laptops. Last year, the company recognized revenues of $4,000,000. Total costs for the period were $2,000,000, of which $500,000 were fixed. If sales were to increase by $150,000, by how much would Computate’s operating income increase?

Thomasville Furniture Industries offers several types of high-performance fabrics that are capable of withstanding chemicals as harsh as chlorine. A Midwestern manufacturing company that uses fabric in several products has a report showing that the present worth of fabric purchases over a specified 5-year period was $900,000. If the costs are known to have increased geometrically by 5% per year during that time and the company uses an interest rate of 15% per year for investments, what was the cost of the fabric in year 1?

Barnam Company currently produces and sells 6,000 units of a product that has a contribution margin of $7 per unit. The company sells the product for a sales price of $24 per unit. Fixed costs are $29,400. The company has recently invested in new technology and expects the variable cost per unit to fall to $12 per unit. The investment is expected to increase fixed costs by $21,000. After the new investment is made, how many units must be sold to break-even? (Do not round intermediate calculations.) Multiple Choice 5,450 units 7,200 units 2,450 units 4,200 units

The Sandstone Corporation uses an injection molding machine to make a plastic product, Z35, after receiving firm orders from its customers. Sandstone estimates that it will receive 60 orders for Z35 during the coming year. Each order of Z35 will take 100 hours of machine time. The annual machine capacity is 8,000 hours. Q. Sandstone is considering introducing a new product, Y21. The company expects it will receive 30 orders of Y21 in the coming year. Each order of Y21 will take 40 hours of machine time. Assuming the demand for Z35 will not be affected by the introduction of Y21, calculate (a) the average waiting time for an order received and (b) the average manufacturing cycle time per order for each product, if Sandstone introduces Y21.

Compute the break-even point in dollar sales for next year assuming the machine is installed. Astro Company sold 28,500 units of its only product and reported income of $57,900 for the current year. During a planning session for next year’s activities, the production manager notes that variable costs can be reduced 50% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $142,000. Total units sold and the selling price per unit will not change.  ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($50 per unit) $ 1,425,000 Variable costs ($47 per unit) 1,339,500 Contribution margin 85,500 Fixed costs 27,600 Income $ 57,900

Disk City, Inc. is a retailer for digital video disks. The projected net income for the current year is $1,760,000 based on a sales volume of 260,000 video disks. Disk City has been selling the disks for $19 each. The variable costs consist of the $8 unit purchase price of the disks and a handling cost of $2 per disk. Disk City’s annual fixed costs are $580,000.   Management is planning for the coming year, when it expects that the unit purchase price of the video disks will increase 30 percent. (Ignore income taxes.) Q. What volume of sales (in dollars) must Disk City achieve in the coming year to maintain the same net income as projected for the current year if the unit selling price remains at $19? (Do not round intermediate calculations. Round your final answer to the nearest whole number.)