The sale price of the unique product is $30, contribution margin ratio 70%and the fixed expenses of the business are $300.000. Expecting $210.300 profit in thenext period, made a new market research for profit planning and obtained thefollowing results:a) A 10% decrease in the unit sale price will cause a 20% increase in the sales quantity,b) A 15% decrease in the unit sale price will cause a 30% increase in the sales quantity,c) A 20% decrease in the unit sale price will cause a 40% increase in the sales quantity.As a manager of the business make your decision, is there a need to make a change in thesale price, if "Yes" choose the most appropriate option.

The series of steps taken to reach a certain profit level is known as profit planning. These…

Answered: The sale price of the unique product is…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Tomperance, inc. is studying marketing cost and sales volume, and has generated the following information by use of a scatter diagram and a least sauares regression analysis Regression Aralyss $750 $43,000 Scater Dagram Variabie cost per Unt so Tocal mondhy fCd cost 541500 Tomporance is now proparing an cstmate for monthly sales of 19,000 units. On the basis of the data presonted, compute the most accurate salos forocast possibie. O An amount other than those listed above. O $I84300. S176.700. O S172.200. O S1700.
A company is assessing granting credit to a new customer. The variable cost per unit is $88, the current price is $115, the probability of default is 34% and the monthly required return is 4.0%. Calculate the NPV of the switch. Assume the customer will purchase once.
(Use information attached) Calculate the total Marginal Income and Net Profit/Loss if all the tables are sold. Use the marginal income ratio to calculate the break-even value. Calculate the new total Marginal Income and Net Profit/Loss, if an increase in advertising expense by R100 000 is expected to increase sales by 400 units. How many units must be sold if the company wishes to earn a net profit of R298 920. Based on the expected sales volume of 2 400 units, determine the sales price per unit (expressedin rands and cents) that will enable the company to break even.
Calculate the information below and use income statement A) PV ratio B)profit when sales are 20000 C)New BE point if selling price is reduced 20% Fixed cost 4000 Break even point 10000
Calculate the Operating Leverage for a business given the following data: Sales = $300,000.00 Variable Costs = 75% of Sales Operating Income = $40,000.00 Group of answer choices a. 0 b. 7.500 c. 1.875 d. 1.333
e. 5,000 XYZ company is studying the profitability of a change in operation and has gathered the following information. Current Operation: Fixed Costs: $38,000, Selling Price: $16, Variable Cost: $10, and Sales (Units): 9,000. Anticipated Operation: Fixed Costs: $48,000, Selling Price: $22, Variable Cost: $12, and Sales (Units): 6,000. Should XYZ company make the change? Select one: O a. No, because sales will drop by 3,000 units. Ob. It is impossible to judge because additional information is needed. Oc. No, because the company will be worse off by $4,000. O d. Yes, the company will be better off by $6,000. Oe. No, because the company will be worse off by $22000. Next page
Bha
Compony XYZ is currently making sales of $ 200,000. At this level, the variable experies were $ 100.000 company XYZ expects sales to increase to $ 250,000 in the coming period with no changer is expected to find expenses. How much is the expected change pront:
Study the information given below and answer each of the following questions independently: Calculate the total Marginal Income and Net Profit/Loss if all the tables are sold. 3.1 Use the marginal income ratio to calculate the break-even value. Calculate the new total Marginal Income and Net Profit/Loss, if an increase in advertising expense by R100 000 is expected to increase sales by 400 units. 3.2 3.3 3.4 3.5 How many units must be sold if the company wishes to earn a net profit of R298 920. Based on the expected sales volume of 2 400 units, determine the sales price per unit (expressed in rands and cents) that will enable the company to break even. INFORMATION Samcor Limited manufactures tables. The following information was extracted from the budget for the year ended 30 June 2022: 1. 2. 3. 4. 5. Total production and sales Selling price per table Variable manufacturing costs per table: Direct material Direct labour Overheads Fixed manufacturing overheads Other costs: Fixed…

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