Reference no: EM131288049
Scott is evaluating a business opportunity to sell cookware at trade shows. Scott can buy the cookware at a wholesale cost of $210 per set. He plans to sell the cookware for $350 per set. He estimates fixed costs such as plane fare, booth rental cost, and lodging to be $5,600 per trade show.
A. Determine the number of cookware sets Scott must sell at a trade show to break even (zero profit or loss).
B. Assume Scott wants to earn a profit of $4,900 per show.
B. (1) Determine the sales volume in units necessary to earn the desired profit.
B. (2) Determine the sales volume in dollars necessary to earn the desired profit.
B. (3) Using the contribution margin format, prepare an income statement to confirm your answers to parts 1 and 2.
C. Determine the margin of safety between the sales volume at the break-even point and the sales volume required to earn the desired profit. Determine the margin of safety in both sales dollars and as a percentage.
D. After researching the market, Scott concludes that the $350 per set selling price is too high. Customers will likely pay only $310 per set. Scot believes he can obtain a cost reduction from his supplier of $20 per set (variable cost drops from $210 per set to $190 per set) and still provide the level of quality required to achieve a sales volume of 75 sets. Under these circumstances, what amount of fixed costs can Scott incur and still obtain the target profit of $4,900? Support your answer with appropriate computations.
|
How might you characterize the effects in your film
: Explain how the different categories of sound are being used in your chosen film - Assess the impact of sound in establishing the theme and how does the use of sound inform the mood of the scene, or the film overall?
|
|
Evaluate the ethics of the tax shelter transactions
: How can balanced scorecard measures be used for revenue process planning? Evaluate the ethics of the tax shelter transactions, including your concerns about the practices. Who are the stakeholders in this case, and what are your professional responsi..
|
|
Organizational alignment of people in llb
: Explain the type of culture that will enhance the organizational alignment of people in LLB; Explain what organizational culture is and how it relates to the structure of the organization;
|
|
Pay for the steel per ton to still get the desired markup
: You are the buyer of steel plate for a large steel distributor. You are looking for a supplier of steel plate that your salespeople could sell in the marketplace for $625 per metric ton. If your objective is a 30% markup based on selling price, what ..
|
|
Determine the margin of safety between the sales volume
: Scott is evaluating a business opportunity to sell cookware at trade shows. Scott can buy the cookware at a wholesale cost of $210 per set. He plans to sell the cookware for $350 per set. Determine the margin of safety between the sales volume at the..
|
|
Analyze elements of cinematography and editing
: In your view, what mood, symbolism, or meaning results from the scene's creative editing and cinematography - Support your claims with examples from the required material(s) and/or other scholarly resources, and properly cite any references.
|
|
Salespeople could sell in the marketplace
: You are the buyer of steel plate for a large steel distributor. You are looking for a supplier of steel plate that your salespeople could sell in the marketplace for $625 per metric ton. If your objective is a 30% markup based on selling price, what ..
|
|
Synchronizes the resources of the organization
: The organizing function is where management gathers and synchronizes the resources of the organization (people, capital, and physical) to complete the goals set out in the planning stage.
|
|
Create a total rewards strategy with recommendations
: Include an analysis of legislation that may impact decisions made about compensation and benefits.
|