account issue raised Jersey Manufacturing uses a distribution channel that includeswholesalers to retailers to the ultimate consumers. The Jerome Widget1000 is priced to wholesale at $250.00. Jersey earns a 30% margin oneach Widget 1000 unit. Jersey's wholesalers markup each unit for $75.00.Retailers typically charge $700.00 to customers during peak season for aWidget 1000, but the unit can be priced by retailers as low as $650.00 off-season.What is the GPM% for retailers who charge the lowest stated price in theoff-season and what is the corresponding markup on cost percentage?Show your complete solution.

Here is the full detailed solution for calculating the Gross Profit Margin Percentage (GPM%) and the…

Answered: Jersey Manufacturing uses a…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 6EA: Reubens Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in...

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Marquette has an opportunity to sell its product through an online retailer. To begin selling through this online platform, they are required to ship 2,000 units to the retailers’ order fulfillment warehouse. The other condition of this offer is that they pay a one-time vendor marketing fee of $5,000. To get the units to the fulfillment warehouse by the deadline Marquette will need to pay for expedited shipping at a cost of $10 per unit. What is the minimum price Marquette should charge the retailer for this initial order of 2,000 units? (Show all supporting calculations). (NOTE: ignore taxes or other costs not specifically mentioned in the questions.)
Bluebird Mfg has received a special one time order for 15000 bird feeders at $3.20 per unit. Bluebird currently produces and sells 75000 units at $7.20 each. This level represents 80% of its capacity. These bird feeders would be marketed under the wholesaler's name and would not affect bluebird sales accepts this additional business, the effect on net income will be?
Wok Around the Clock, Inc., sells specialty woks. In the current year it expects to incur $840,000 in variable costs and $120,000 in fixed costs to make and sell 10,000 woks at $100 each.If Wok Around the Clock accepts a special order from Hard Wok Cafe to purchase 1,000 woks at $80 each, how much would it make or lose on this special order?
Julia's Motorcycles Inc. produces one model of motorcycle, called the Lightning. The Lightning has an MSRP of $2,500. The cost to produce one unit is $800. Their fixed costs are $2,000,000. You are responsible for deciding whether you should sell the Lightning via a retailer named Rugged Motors Inc. Rugged typically discounts its products 18% from the MSRP. They are asking for 55% distributor margin. What is the retail price? (show your work)
The I-75 Carpet Discount Store has an annual demand of 10,000 yards of Super Shag carpet. The annual carrying cost for a yard of this carpet is $0.75, and the ordering cost is $150. The carpet manufacturer normally charges the store $8 per yard for the carpet; however, the manufacturer has offered a discount price of $6.50 per yard if the store will order 5,000 yards. How much should the store order, and what will be the total annual inventory cost for that order quantity?
Julia's Motorcycles Inc. produces one model of motorcycle, called the Lightning. The Lightning has an MSRP of $2,500. The cost to produce one unit is $800. Their fixed costs are $2,000,000. You are responsible for deciding whether you should sell the Lightning via a retailer named Rugged Motors Inc. Rugged typically discounts its products 18% from the MSRP. They are asking for 55% distributor margin. How much does Rugged earn per unit? (show your work)
Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $2.40 per unit. Bluebird currently produces and sells 75,000 units at $6.40 each. This level represents 80% of its capacity. These bird feeders would be marketed under the wholesaler's name and would not affect Bluebird's sales through its normal channels. Production costs for these units are $3.60 per unit, which includes $1.95 variable cost and $1.65 fixed cost. If Bluebird accepts this additional business, the effect on net income will be: Multiple Choice $29,250 decrease. $18,000 decrease. $36,000 increase. $29,250 increase. $6,750 increase.
Jansen Crafters has the capacity to produce 50,000 oak shelves per year and is currently selling 44,000 shelves for $32 each. Curate Furniture approached Jansen about buying 1,200 shelves for bookshelves it is building and is willing to pay $26 for each shelf. No packaging will be required for the bulk order. Jansen usually packages shelves for Home Depot at a price of $1.50 per shelf. The $1.50 per shelf cost is included in the unit variable cost of $27, with annual fixed costs of $320,000. However, the $1.50 packaging cost will not apply in this case. The fixed costs will be unaffected by the special order and the company has the capacity to accept the order. Based on this information, what would be the profit if Jensen accepts the special order?
Jasper Company is a wholesaler that buys merchandise in large quantities. Its supplier’s catalog indicates a list price of $500 per unit on merchandise Jasper intends to purchase, and offers a 30% trade discount for large quantity purchases. The cost of shipping for the merchandise is $7 per unit. Jasper’s total purchase price per unit will be:
JCBilco Manufacturing produces and sells oil filters for $3.30 each. A retailer has offered to purchase 25,000 oil filters for $1.36 per filter. Of the total manufacturing cost per filter of $2.15, $1.35 is the variable manufacturing cost per filter. For this special order, JCBilco would have to buy a special stamping machine that costs $8,500 to mark the customer's logo on the special-order oil filters. The machine would be scrapped when the special order is complete. This special order would use manufacturing capacity that would otherwise be idle. No variable nonmanufacturing costs would be incurred by the special order. Regular sales would not be affected by the special order. Would you recommend that JCBilco accept the special order under these conditions?

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