Your answer is partially correct. Waterways is thinking of mass-producing one of its special-order sprinklers. To do so would increase unit variable costs for all sprinklers by an average of $0.70. The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average unit sales price would increase $0.20. Waterways currently sells 484,000 sprinkler units at an average unit selling price of $28.20. The manufacturing costs are $7,589,350 variable and $1,925,074 fixed. Selling and administrative costs are $2,647,250 variable and $805,500 fixed. If the average unit sales price per sprinkler did not increase when the company began mass-producing the special-order sprinkler, what would be the effect on the company? (Round ratio answer to 0 decimal places, e.g. 5% and profit answer to 2 decimal places, e.g. 5,275.25.)
Your answer is partially correct. Waterways is thinking of mass-producing one of its special-order sprinklers. To do so would increase unit variable costs for all sprinklers by an average of $0.70. The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average unit sales price would increase $0.20. Waterways currently sells 484,000 sprinkler units at an average unit selling price of $28.20. The manufacturing costs are $7,589,350 variable and $1,925,074 fixed. Selling and administrative costs are $2,647,250 variable and $805,500 fixed. If the average unit sales price per sprinkler did not increase when the company began mass-producing the special-order sprinkler, what would be the effect on the company? (Round ratio answer to 0 decimal places, e.g. 5% and profit answer to 2 decimal places, e.g. 5,275.25.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Vipuld
![Your answer is partially correct.
Waterways is thinking of mass-producing one of its special-order sprinklers. To do so would increase unit variable costs for all sprinklers by an average of $0.70.
The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average unit sales price would increase $0.20.
Waterways currently sells 484,000 sprinkler units at an average unit selling price of $28.20. The manufacturing costs are $7,589,350 variable and $1,925,074
fixed. Selling and administrative costs are $2,647,250 variable and $805,500 fixed.
If the average unit sales price per sprinkler did not increase when the company began mass-producing the special-order sprinkler, what would be the effect on the
company? (Round ratio answer to 0 decimal places, e.g. 5% and profit answer to 2 decimal places, e.g. 5,275.25.)
IN](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa60bc0c5-0237-4f62-841e-f9985bf92d33%2F479fe803-aa04-4b11-ac5e-25f357b25d0f%2F68a33ef4_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Your answer is partially correct.
Waterways is thinking of mass-producing one of its special-order sprinklers. To do so would increase unit variable costs for all sprinklers by an average of $0.70.
The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average unit sales price would increase $0.20.
Waterways currently sells 484,000 sprinkler units at an average unit selling price of $28.20. The manufacturing costs are $7,589,350 variable and $1,925,074
fixed. Selling and administrative costs are $2,647,250 variable and $805,500 fixed.
If the average unit sales price per sprinkler did not increase when the company began mass-producing the special-order sprinkler, what would be the effect on the
company? (Round ratio answer to 0 decimal places, e.g. 5% and profit answer to 2 decimal places, e.g. 5,275.25.)
IN
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