Chris micro chip produces and sell its product at the price of P160 with its variable cost of P64. The company's fixed cost is 2,304,000 per annum. The company operates at a margin of safety which was at 40%. (1) Find the total sales made by the company. (1I) The company wants to introduce highly sophisticated modern chip completely new to the market with high research costs. Suggest the pricing method which will be suited for its new product.

Chris micro chip produces and sell its product at the price of P160 with its variable cost of P64. The company's fixed cost is 2,304,000 per annum. The company operates at a margin of safety which was at 40%. (1) Find the total sales made by the company. (1I) The company wants to introduce highly sophisticated modern chip completely new to the market with high research costs. Suggest the pricing method which will be suited for its new product.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Heat Inc. sells computer hard drives, and the market is competitive (i.e., sales price will not be affected by Heat's sales volume). Its EBIT for 2022 was $69,000 when the sales quantity was 500 units. In 2023, its EBIT was $119,000 when the sales quantity was 700 units. a) Calculate its contribution margin per unit and total fixed costs. b) Calculate the degree of operating leverage for 2022 and 2023. c) If Heat changes its production technology by doubling its fixed costs and the breakeven (indifferent) quantity is 1, 120 units, find the new contribution margin. Heat has $40,000 debt that pays annual interest of 15% and 2,000 outstanding common shares that are trading at $25. Its tax rate is 30% . d) Calculate EPS for 2022 and 2023. e) Calculate the degree of financial leverage for 2022 and 2023. f) Calculate the degree of total leverage for 2022 and 2023. g) Heat considers borrowing $20,000 new debts (that also pay 15% interest) to buy back common shares (at current price of $25 per…
Assume that you are the team leader of strategic planning and advisory board of M/S XYZ company. The company has decided to enter the market with a new electronic product. Your team conducted a marker research and presented the following two strategies along with the necessary data. Strategy A: Build a large plant with an estimated cost of 20,00,000 Rials. This alternative can face two states of nature on market conditions: High demand with a probability of 0.70, or a low demand with a probability of 0.30. If the demand is high, the company can expect to receive an annual revenue of 5,00,000 Rials for 7 years. If the demand were low the annual revenue would be only 1,00,000 Rials.
Heat Inc. sells computer hard drives, and the market is competitive (i.e., sales price will not be affectedby Heat’s sales volume). Its EBIT for 2022 was $69,000 when the sales quantity was 500 units. In 2023,its EBIT was $119,000 when the sales quantity was 700 units.a) Calculate its contribution margin per unit and total fixed costs.b) Calculate the degree of operating leverage for 2022 and 2023.c) If Heat changes its production technology by doubling its fixed costs and the breakeven(indifferent) quantity is 1,120 units, find the new contribution margin.Heat has $40,000 debt that pays annual interest of 15% and 2,000 outstanding common shares that are trading at $25. Its tax rate is 30%. d) Calculate EPS for 2022 and 2023.e) Calculate the degree of financial leverage for 2022 and 2023.f) Calculate the degree of total leverage for 2022 and 2023.g) Heat considers borrowing $20,000 new debts (that also pay 15% interest) to buy back common shares (at current price of $25 per share),…
Answer the required question. Provide a complete solution thank you
Please assist with working of this question
Sampson Corporation is evaluating the introduction of a new product. The possible levels of unit sales and the probabilities of their occurrence are shown next: Possible Market Reaction Low response Moderate response High response Very high response Sales in Units 40 Probabilities 0.30 70 0.20 90 120 0.20 0.30 a. What is the expected value of unit sales for the new product? Note: Do not round Intermediate calculations and round your answer to the nearest whole unit.) Answer is complete but not entirely correct. Expected value 70 units b. What is the standard deviation of unit sales? Note: Do not round Intermediate calculations. Round your answer to 2 decimal places. Answer is complete but not entirely correct. Standard deviation 19.24 units
Witrox Bhd sells two models of smartphone, the Oppo and the Xiaomi. Oppo RM 60.0 35.0 25.0 Sales price per unit Variable cost per unit Contribution margin per unit Witrox has determined that it would break even at an annual sales volume of 50,000 units, of which 75% would be Oppo. Required: a) What are the contribution margin ratios for each product and the company? b) What is the amount of Witrox's estimated annual fixed costs? Xiaomi RM 85.0 54.0 31.0 c) What is the sales mix? d) Prepare a product line income statement with operating income of RM500,000. Fixed production costs will increase RM45,000 and fixed administrative costs will increase RM22,500 to support the increase in volume.
Can someone help me with part B of this problem?: Verasource Microprocessor Corporation sells 200 computer chips a month for $1,500 each. variable costs are $1,500,000. Fixed costs are $500,000. there's a defect rate of 8%. What is the hidden cost to the company of making this rate of defectives instead of 2,000 good chips each month? Suppose a six sigma effort can reduce the defects to a six sigma level. what is the impact on profitability?
Easy Solutions limited manufactures electronic calculators. One of its top-selling calculators has a price of $50. Recently, a competitor entered the market and started offering a similar calculator at a price that is 20% below the $50 price of Easy Solutions. Company policy requires Easy Solutions to have a profit margin equal to 30% on sales of each of its products. 1.What target cost would have to be set for the Easy Solutions calculator to remain competitive and still meet the target profit margin of the company? 2.
Alberto Technologies, manufacture and sells an electronic control device for $297. It has costs of $231 to manufacture it. A competitor is bringing a new electronic control device to market that will sell for $253. Marketing manager at Alberto believes it must lower the price to $253 to compete in the market for electronic control device. Marketing manager believes that the new price will cause sales to increase by 12%, even with a new competitor in the market. Alberto's sales are currently 6,000 units per year. What is the target cost per unit if the target operating income is 25% of sales