Margaret Williams, production manager at Williams Manufacturing, finds her profits at $15,000 inadequate for her business. The bank is insisting on an improved profit picture prior to an approval of a loan for some new equipment. Margaret would like to improve the profit line to $25,000 so she can obtain the approval for the loan. Given the information below and using a Sales Strategy, what percentage change of sales would need to be increased to achieve a $25,000 profit? FACTOR Sales Cost of Supply Chain Purchases Production Costs Fixed Costs Profit Percentage 100% 70% 12% 12% 6% Current Situation $250,000 $175,000 $30,000 $30,000 $15,000
Margaret Williams, production manager at Williams Manufacturing, finds her profits at $15,000 inadequate for her business. The bank is insisting on an improved profit picture prior to an approval of a loan for some new equipment. Margaret would like to improve the profit line to $25,000 so she can obtain the approval for the loan. Given the information below and using a Sales Strategy, what percentage change of sales would need to be increased to achieve a $25,000 profit? FACTOR Sales Cost of Supply Chain Purchases Production Costs Fixed Costs Profit Percentage 100% 70% 12% 12% 6% Current Situation $250,000 $175,000 $30,000 $30,000 $15,000
Practical Management Science
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ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
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Transcribed Image Text:Margaret Williams, production manager at Williams Manufacturing, finds her profits at $15,000 inadequate for her business. The
bank is insisting on an improved profit picture prior to an approval of a loan for some new equipment. Margaret would like to
improve the profit line to $25,000 so she can obtain the approval for the loan.
Given the information below and using a Sales Strategy, what percentage change of sales would need to be increased to achieve a
$25,000 profit?
O
O
O
A
с
D
FACTOR
Sales
Cost of Supply Chain Purchases
Production Costs
B 14.4% increase
E
Fixed Costs
Profit
11.1% increase
18.8% increase
22.2% increase
26.6% increase
Percentage
100%
70%
12%
12%
6%
Current Situation
$250,000
$175,000
$30,000
$30,000
$15,000
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