Example of Analytics a. What is a battery manufacturer's break-even level of sales, based on the falling prices of car batteries? b. Should the cost of a car battery be a fixed cost or a variable cost at Tesla? c. How do profit margins change at differing levels of car battery prices at Rivian, an electric truck manufacturer (and a competitor to Tesla in the electric car space)?

Example of Analytics a. What is a battery manufacturer's break-even level of sales, based on the falling prices of car batteries? b. Should the cost of a car battery be a fixed cost or a variable cost at Tesla? c. How do profit margins change at differing levels of car battery prices at Rivian, an electric truck manufacturer (and a competitor to Tesla in the electric car space)?

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

1. Which action would not lower a company's break-even point? O increase selling prices () reduce variable costs () decrease fixed costs ) sell more units O answer not given O O O OO
Capital Motors, a car dealership, recently announced that itwill rely less on high-volume strategies such as discounts andrebates to improve its profitability. Another strategy it willemploy is to sell fewer cars to rental fleets, which eventuallyreturn the cars to Capital for sale at low auction prices. Howdo these types of sales affect Capital’s profitability?
Which statement is incorrect? We cannot use profitability to value Coca Cola because it has negative earnings To avoid negative earnings but still capture profitability, one should use sales divided by expenses O To capture innovation growth, we should use R&D growth O To capture how early in the cycle firms spend on innovation, they should use R&D/sales
Marketing
Companies often use leverage to augment profits. Based on what you learned this week, please explain the following in detail: With regards to Operating Leverage, please explain why a company with HIGH Operating Leverage faces greater financial risk in a declining sales period compared to a company with LOW Operating Leverage. (HINT: The key here is the relation between fixed costs and variable costs.) What does a business's Contribution Margin represent? What does the Contribution Margin have to do with Operating Leverage?
stion Company XYZ produces and sells two types of calculators: Basic and Scientific. The Basic has a lower selling price per unit compared to the Scientific. However, the Basic has a higher contribution margin compared to the Scientific. Due to fixed production capacity, the company has a cap on total production ability. If the company's CEO has decided to shift the sales mix towards producing more Scientific calculators. What red would be the effect on total profits? d out of O a. Total profits would increase g O b. Total profits would decrease on Oc. Total profits would remain the same O d. None of the given answers O e. Cannot be determined using the above information
"Advise the Pricing practices or policies to be adapted for each of the items discussed below with proper reasons" A.New product launch with massive production B.New model small car for the market C.New launch of a product, but not for the market
A higher gross margin implies ______________ . The company has huge market share The company has the flexibility to change its pricing policy The company sells goods at huge discounts The cost of goods sold remains same over the years
Both Apple and Google sell electronic devices, and each of these companies has a different product mix. Assume the following data are available for both companies. ($ millions) Sales Variable costs Fixed costs Apple $ 260,174 122,034 82,884 Required: 1. Compute income for each company. 2. Compute the degree of operating leverage for each company. 3. If unit sales decline, which company would experience the larger decline in income? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Google $ 161,857 86,302 41,212 Income Compute income for each company. (Enter your answers in million of dollars.) Apple Google
Part 1: Use the Value per Products Description bar chart.1. Which product has the highest profit value?2. What is the profit value for the product with the highest profit value?3. Do any of the products have a negative profit value (the company is losing money on them)?4. If there are products with a negative profit value, which products are those?5. Do you think the company should keep selling the “Shirt Girls (pink)” product? Why or whynot?