Question
A. The owner of AStar is planning to close down Caulfield store as she thinks that it is not making money. Calculate the Total Income,
A. The owner of AStar is planning to close down Caulfield store as she thinks that it is not making money. Calculate the Total Income, Divisional Contribution, Common Cost and Profit for the business as a whole if they close Caulfield store. Explain briefly, how much the company will lose/gain if they close Caulfield. (5 marks)
B. Provide 3 different aspects of non-financial information that the owner of Astar should consider before closing the Caulfield store. (3 marks)
C. Due to the Covid-19 pandemic, the CBD store received a special-order request from the local government to provide goods to people in isolation. Twice a week, an order will be received for what goods people in isolation require and these goods will then AStar is to deliver these to the people. Provide 2 factors that the owner should to consider before accepting this special order. (2 marks)
AStar Asian groceries has 3 stores across metropolitan Melbourne. One in Clayton, one in Caulfield and one in the Melbourne CBD. Recently, there has been a road project that was just in front of the Caulfield Astar Asian groceries store. This project has affected the income for the Caulfield store. The project is expected to take place over the whole of one year. Below is the performance report from the 3 different stores for the past month. Caulfield Clayton Total Melbourne CBD $50,000 Income $15,000 (4,500) $35,000 (9,000) $100,000 (25,500) (12,000) ($16,000) ($14,000) ($12,000) (42,000) Divisional Variable Cost Divisional Fixed Cost Divisional Contribution Common Costs 22,000 (3,500) 14,000 32,500 (5,000) 17,000 (5.000) (8,500) (5,000) 9,000 ($15,000) 17,500 ProfitStep by Step Solution
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