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Outdoors Place operates a commercial plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit? plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit?

Outdoors Place operates a commercial plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit? plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit?

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter12: Activity-based Management
Section: Chapter Questions
Problem 28P: Bienestar, Inc., has two plants that manufacture a line of wheelchairs. One is located in Kansas...
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Outdoors Place operates a commercial plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit? plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit?
Transcribed Image Text:Outdoors Place operates a commercial plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit? plant nursery, where it propagates plants for garden centers throughout the region. Outdoors Place has $5,100,000 in assets. Its annual fixed costs are $650,000, and the variable costs for the potting soil, container, label, seedling, and labor for each gallon-size plant total $1.40. Outdoors Place volume is currently 480,000 units. Competitors offer the same plants, at the same quality, to garden centers for $3.75 each. Garden centers then mark them up to sell to the public for $7 to $10, depending on the type of plant. Given Outdoors Place's current costs, will its owners be able to achieve their target profit?
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