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If patakys sales department is able to infl uence customers

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(Sales budget) Pataky Co.'s sales manager estimates that 2,000,000 units of product RI#698 will be sold in 2011. Th e product's selling price is expected to decline as the result of technology changes during the year and estimates of the sales price are as follows:

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
$17 $16 $14 $12

In talking with customers, the sales department discovered that sales quantities per quarter could vary substantially. Th us, the sales manager has prepared the following three sets of quarterly sales projections:

  • 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total
  • Scenario A 600,000 300,000 640,000 460,000 2,000,000
  • Scenario B 400,000 700,000 250,000 650,000 2,000,000
  • Scenario C 530,000 480,000 800,000 190,000 2,000,000

If Pataky's sales department is able to infl uence customers, which of the potential sales scenarios would be most profi table for the company? Would that scenario possibly cause the company any diffi culties?

Reference no: EM13592621

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