Bathrooms and kitchens are typically the most important selling features of s home. Rouse Builders could differentiate the homes by upgrading the atmos and kitchens. The upgrades would cost $22,000 per home bur would enable Rouse Builders to increase the selling prices by $38.500 per home (Kitchen and bathroom upgrades typically add about 175% of their cost to the value of any home.) If Rouse Builders makes the upgrades, what will the new co-phus price per home be? Should the company differentiate in product in this manner? the special orderan's $92 cost to make the sunglasses.hat would you say?an's staff accountants, to explain whether his analysisLearning Objective 2fHelede Rouse Builders's costs per developed sublot are as follows:3. Desired profit $32 490Land%2 51,000Construction121,000LandscapingVariable selling costs00000 000Rause Builders would like to earn a profit of 16% of the variable cost of each homeld Similar homes offered by competing builders sell for $202,000 each. Assume thecompany has no fixed costsRequirements1. Which approach to pricing should Rouse Builders emphasize? Why?2 Will Rouse Builders be able to achieve its target profit levels?3. Bathrooms and kitchens are typically the most important selling features of ahome. Rouse Builders could differentiate the homes by upgrading the bathroomsand kitchens. The upgrades would cost $22,000 per home but would enableRouse Builders to increase the selling prices by $38,500 per home. (Kitchen andbathroom upgrades typically add about 175% of their cost to the value of anyhome.) If Rouse Builders makes the upgrades, what will the new cost-plus pricehome be? Should the company differentiate its product in this manner?yper

Cost-volume-profit (CVP) analysis is a method of cost accounting that looks at the impact that…

Answered: Bathrooms and kitchens are typically…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Bathrooms and kitchens are typically the most important selling features of s home. Rouse Builders could differentiate the homes by upgrading the atmos and kitchens. The upgrades would cost $22,000 per home bur would enable Rouse Builders to increase the selling prices by $38.500 per home (Kitchen and bathroom upgrades typically add about 175% of their cost to the value of any home.) If Rouse Builders makes the upgrades, what will the new co-phus price per home be? Should the company differentiate in product in this manner?

the special order
an's $92 cost to make the sunglasses.
hat would you say?
an's staff accountants, to explain whether his analysis
Learning Objective 2
fHelede Rouse Builders's costs per developed sublot are as follows:
3. Desired profit $32 490
Land
%2 51,000
Construction
121,000
Landscaping
Variable selling costs
000
00 000
Rause Builders would like to earn a profit of 16% of the variable cost of each home
ld Similar homes offered by competing builders sell for $202,000 each. Assume the
company has no fixed costs
Requirements
1. Which approach to pricing should Rouse Builders emphasize? Why?
2 Will Rouse Builders be able to achieve its target profit levels?
3. Bathrooms and kitchens are typically the most important selling features of a
home. Rouse Builders could differentiate the homes by upgrading the bathrooms
and kitchens. The upgrades would cost $22,000 per home but would enable
Rouse Builders to increase the selling prices by $38,500 per home. (Kitchen and
bathroom upgrades typically add about 175% of their cost to the value of any
home.) If Rouse Builders makes the upgrades, what will the new cost-plus price
home be? Should the company differentiate its product in this manner?
y
per

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