User Account

All Pages

Estimate the demand for sams pizza in the first year

Assignment Help Cost Accounting
Reference no: EM131332751

Assignment- Show the step by step solutions to the following questions:

I. A firm is able to sell 10,000 units at $ 12 per piece. The company fixed cost is $30,000. Variable cost is $6 per unit.

1. What is the contribution per unit?

2. What is the breakeven sales in $? What is the breakeven sale in units?

3. What is the markup on sales price? What is the mark up on total cost?

They raise the price to $15 and demand drops to 8000.

4. Calculate the price elasticity.

5. What is the n e w markup (profit margin %) on the sales price ($15)? What is the new mark up ( profit margin %) on total cost?

6. Please calculate the total profit for this company as well as the profit per each toy sold. Are they better off raising the price?

II. A firm is able to sell 10,000 units. The company fixed cost is $10,000. Variable cost is $6 per unit. Contribution margin (CM) is $4.

1. What is the markup (profit margin %) on sales price? What is the mark up on total cost (profit margin %)?

2. If the price elasticity of demand is 2, how many units they can sell if they drop the SP by $2.

3. What is the new markup on sales price? What is the new mark up on total cost? (Hint: use the new sales)

4. Please calculate the total profit for this company as well as the profit per each toy sold (Hint: use the new demand)

III. A company manufacturing toys has a fixed cost of $100,000. Variable cost is $6 per toy. Selling price is $10 per toy. Company target profit is $120,000.

How many toys should be sold to reach the target profit?

The company found that its variable cost is going to increase by $2 and plans to raise its selling price by $3 and reduced the fixed costs by $20,000. How many more(less) toys have to be sold at the new price to reach the target profit of $120,000?

What is the markup (profit margin %) on sales price at this new sales volume? What is the markup (profit margin %) on total cost?

Sam is developing a business plan for starting Pizza business in Waltham. Sam specializes in pepperoni pizza. Based on the secondary data he has found out that there are 20,000 families in the area and about 20% of these families are strict vegetarians. He believes that he can get 10% of the market share of the potential customers. His research reveals an average family consumes 10 pizzas per year.

It costs a total of $ 6 to make a Pepperoni pizza. Sam is planning to introduce his Pepperoni pizza at $ 8 and raise the price by $2 in the second year. Price elasticity of demand for pizza is 0.50

1. Estimate the demand for Sam's pizza in the first year

2. Calculate the % markup (profit margin %) on sales price and total cost in the first year

b. Estimate the demand for Pizza in the second year with the new price.

d. Calculate the % mark up on sales price and total cost in the second year

IV. NE is planning to replace the central A/C system for the class rooms. In response to their request for proposal, NEU received two proposals. The details of the proposal are given below.

Company A Company C

A/C system cost including installation $ 35,000 45,000

Life in years 10 10

Insurance per year $ 900 1,200

Electricity charge per month $ 800 450

Maintenance charges per quarter $ 350 300

System Overhaul - number per year 4 3 in two years

Material Cost per overhaul $ 1,000 400

Numberoflabor hoursperoverhaul 8 3

Labor rate for overhaul $/hour 100 100

Use life cycle costs to recommend a system for NEU. Show the calculations to support your recommendations.

Reference no: EM131332751

Questions Cloud

Effective interest rate-future value-future value factor : Define the following: Effective interest rate - Future value (FV) - Future value factor - Future value factor of an annuity (FVFA) - Future value of an annuity.
Prove finite belief space has a consistent belief subspace : Prove or disprove: Every finite belief space has a consistent belief subspace.- Prove or disprove: If Y˜ i(ω) is inconsistent for some player i ∈ N, then Y˜ (ω) is also inconsistent.
Using the corporate valuation model approach : Assume that today is December 31, 2015, and that the following information applies to Vermeil Airlines: After-tax operating income [EBIT (1-T)] for 2016 is expected to be $500 million. Using the corporate valuation model approach, what should be the ..
Normally distributed with a mean : Assume that the heights of men are normally distributed with a mean of 67.3 inches and a standard deviation of 3.5 inches. If 100 men are randomly selected, find the probability that they have a mean height greater than 68.3 inches.
Estimate the demand for sams pizza in the first year : Estimate the demand for Sam's pizza in the first year. Calculate the % markup (profit margin %) on sales price and total cost in the first year. Estimate the demand for Pizza in the second year with the new price.
Provide an example of a belief space : Provide an example of a belief space ? with three players, which contains a state of the world ω, such that the minimal belief subspaces of the players at ω are inconsistent, and differ from each other.
What is the total cost savings can be realized : Company A, a low rated rm, desires a xed rate, long term loan. Company A currently has access to oating-rate funds at a margin of 1.2% over LIBOR. Its direct borrowing cost is 13% in the fixed rate bond market. What's the total cost savings can be re..
Calculate the coefficient of determination : Use the value of the linear correlation coefficient to calculate the coefficient of determination. What does this tell you about the explained variation of the data about the regression line? About the unexplained variation?
How to support children with appropriate strategies : It is critical that adults help children learn positive strategies for solving problems and conflicts. Put yourself in the place of a preschool teacher working with a new aide who lacks skills in this area. Write a script or a brief summary that e..

Reviews

Write a Review

Cost Accounting Questions & Answers

  Prepare last years profit report using contribution margin

Prepare last years profit report using the contribution margin format and calculate the effect this will have on the profitability of the dinner assuming fixed costs will be the same as last year.

  Classify the following items as investment by owner

Classify the following items as investment by owner (I), owner's drawings (D), revenues (R), or expenses (E).Then indicate whether each item increases or decreases owner's equity.

  What is the expected value of profits for next year

Nile Riverboat company a major boat building company highly sensitive to the economy, expects profits next year to be $2,000,000 if the economy is strong, $1,2000,000 if the economy is steady and minus $400,000 if the economy is weak.

  Prepare the companys direct labor budget

Prepare the companys direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Omit the "$" sign i..

  How many direct labor hours did tyler company incur

Underapplied overhead analysis Tyler Company applies manufacturing overhead. How many direct labor hours did Tyler Company incur during August?

  Tax consequences of the liquidation distribution

Discuss the similarities and differences between the tax consequences of the operating distribution and the tax consequences of the liquidation distribution.

  Compute actual direct material used and direct labor

Total manufacturing cost during the year was $3,000,000 based on actual direct material, actual direct labor, and applied manufacturing overhead - Compute actual direct material used

  You are the assistant accountant of a small manufacturing

you are the assistant accountant of a small manufacturing company. your manager who is not an accountant is regarding

  Explain what is zero-based budgeting

Explain what zero-based budgeting is and how it can improve theefficiency of the organization? Zero-based budgeting is the process in which managers can plan an educated guess of his or her projected expenses for a precise time period as if the p..

  Compute the number of bonds held

Assuming that the bonds are trading at par and the interest rate remains constant throughout the period to maturity, compute the number of bonds held during each consecutive year of the investment.

  Prepare a cost of goods sold statement for lucero company

Lucero Company, a manufacturing firm, has supplied the following information from its accounting records for the past calendar year. Prepare a cost of goods manufactured statement. Prepare a cost of goods sold statement.

  1 what are the organisational ethical leadership problems

1 what are the organisational ethical leadership problems that resulted in columbiahcas misconduct?2 discuss

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd