Question 3 (4 points) Yoyo's is an ice cream manufacturer with an annual sales volume of...
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Question 3 (4 points) Yoyo's is an ice cream manufacturer with an annual sales volume of 4,000 units. It costs them $2 dollars per unit and they sell at a price of $5 each. Fixed costs to run the business are $150,000 per year. 1. What is the current total contribution? Write your answer and round to the nearest whole number in the question 2 blank below. Do not input dollar signs, commas, spaces or periods. If your answer is 45,678.5 enter it as 45679. Yoyo's is considering increasing the price to $6.50/unit and increasing advertising by $3,000. This would result in a sales decrease of 33%. 2. What is the new total contribution? Write your answer and round to the nearest whole number in the question 2 blank below. Do not input dollar signs, commas, spaces or periods. If your answer is 45,678.5 enter it as 45679. 3. What is the total incremental contribution? Write your answer and round to the nearest whole number in the question 3 blank below. Do not input dollar signs, commas, spaces or periods. If your answer is 45,678.5 enter it as 45679. 4. Should you go ahead with the adjustment? Answer "yes" or "no" in the question 4 blank below. A A Question 3 (4 points) Yoyo's is an ice cream manufacturer with an annual sales volume of 4,000 units. It costs them $2 dollars per unit and they sell at a price of $5 each. Fixed costs to run the business are $150,000 per year. 1. What is the current total contribution? Write your answer and round to the nearest whole number in the question 2 blank below. Do not input dollar signs, commas, spaces or periods. If your answer is 45,678.5 enter it as 45679. Yoyo's is considering increasing the price to $6.50/unit and increasing advertising by $3,000. This would result in a sales decrease of 33%. 2. What is the new total contribution? Write your answer and round to the nearest whole number in the question 2 blank below. Do not input dollar signs, commas, spaces or periods. If your answer is 45,678.5 enter it as 45679. 3. What is the total incremental contribution? Write your answer and round to the nearest whole number in the question 3 blank below. Do not input dollar signs, commas, spaces or periods. If your answer is 45,678.5 enter it as 45679. 4. Should you go ahead with the adjustment? Answer "yes" or "no" in the question 4 blank below. A A
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1 To calculate the current total contribution we need to subtract the total cost from the total reve... View the full answer
Related Book For
Cornerstones of Cost Management
ISBN: 978-1285751788
3rd edition
Authors: Don R. Hansen, Maryanne M. Mowen
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