Assume you are running a retail operation. You calculated weighted sales to be $225.00 per shopping cart. You looked at competitive information and found that the cost of sales for them is 85%. You would like to invest $250,000 for marketing in your business How many customers must you get to breakeven? How many customers must you get to make a 10% operating profit? how would the income statement for this to be presented per unit sale $? per unit cost of sale number of customers needed to make 10% profit total sales $$ total cost of sales gross profit marketing investment operating profit operating profit margin in % ROI

Assume you are running a retail operation. You calculated weighted sales to be $225.00 per shopping cart. You looked at competitive information and found that the cost of sales for them is 85%. You would like to invest $250,000 for marketing in your business How many customers must you get to breakeven? How many customers must you get to make a 10% operating profit? how would the income statement for this to be presented per unit sale $? per unit cost of sale number of customers needed to make 10% profit total sales $$ total cost of sales gross profit marketing investment operating profit operating profit margin in % ROI

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 18E

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Concept explainers

Exclusive Distribution

“Exclusive Distribution is the one where in a manufacturer or supplier authorizes one distributor to carry out the distribution work within a definite region.”

Question

How many customers must you get to breakeven?

How many customers must you get to make a 10% operating profit?

how would the income statement for this to be presented per unit sale $?

per unit cost of sale

number of customers needed to make 10% profit

total sales $$

total cost of sales

gross profit

marketing investment

operating profit

operating profit margin in %

ROI

Formula Formula ROI (%) = Net Income Principal Amount × 100

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