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Acet 2220 Zeigler - Falcon Stationers, Inc. Chapter 3 CVP Case Study (Due Wed 9/19 - start of class) Falcon Stationers, Inc. is currently open
Acet 2220 Zeigler - Falcon Stationers, Inc. Chapter 3 CVP Case Study (Due Wed 9/19 - start of class) Falcon Stationers, Inc. is currently open from 8am to 8pm six days per week. The store is a BGSU retail merchandiser that sells cards, supplies, magazines, and a few books. The following is the most recent annual Income Statement received from the company's external accountant: Sales Cost of sales Gross margin (i.e. Gross Profit) $464,900 162.700 $302,200 S, G& A (i.e. Operating) expenses: $97,000 Salaries Rent Utilities Insurance Misc/Other Profit 60,000 13,500 10,000 4,000 184500 $117.700 As an experiment, Frieda, the owner, kept the store open for only eight hours on a recent Sunday. Resulting sales were $840 and part-time employment payroll costs were $135. Per the above income statement, and after few calculations and creating some percentages, she came up with about $591 as the estimated daily cost of operations without Sunday hours. She then concluded that about $910 in sales revenue would be necessary to justify opening on Sundays. Required: Document the calculations Frieda made to determine her figures of $591 and $910 Be sure to document your work so others can understand your analysis) 1
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