Indicate the effect (increase, decrease, no change, or not enough information) that each of the following situations
Question:
Indicate the effect (increase, decrease, no change, or not enough information) that each of the following situations has on break-even unit sales. If you answer “not enough informa- tion,” list the information that you need in order to be able to determine the effect.
(a) A retail company purchases price tags to use in place of the stickers it has used in the past.
(b) An athletic equipment store leases more retail space.
(c) A bakery increases its advertising expense.
(d) A merchandiser plans to increase the selling price of its product. To counter potential decreases in sales, the merchandiser also plans to increase the amount of per-product commission that the sales staff earns.
(e) An accounting firm plans to increase its billing rate per hour.
(f) A retail company has found a supplier that will provide the same merchandise its old supplier provided, but at a lower price.
(g) A private college in the Northwest installs air conditioning in its dormitories. (h) A retail company reduces advertising expenses and increases the commissions of its sales force.
(i) Instead of having its office building cleaned by a cleaning service, a company plans to hire its own cleaning crew. TW-1
Step by Step Answer:
Accounting Information For Business Decisions
ISBN: 9780030224294
1st Edition
Authors: Billie Cunningham, Loren A. Nikolai, John Bazley