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All data for question is posted, please help solving unsolved part. Winchester Manufacturing, Inc., plans to develop a new industrial motor. The product will take

All data for question is posted, please help solving unsolved part.

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Winchester Manufacturing, Inc., plans to develop a new industrial motor. The product will take 6 months to design and test. The company expects the motor to sell 10,000 units during the first 6 months of sales; 20,000 units per year over the following 2 years; and 5,000 units over the final 6 months of the product's life cycle. The company expects the following costs: (Click the icon to view the cost information.) Read the requirements. Requirement 1. If Winchester prices the motors at $375 each, how much operating income will the company make over the product's life cycle? What is the operating income per unit? Determine the operating income over the product's life cycle. Begin with the variable costs and then the fixed costs, along with the total life cycle operating income. Projected Life Cycle Income Statement i Data Table - X Revenues $ 20,625,000 Variable costs: Months 7-12 1,000,000 i Requirements . X Total Fixed Cost Variable Cost Months 13-36 3, 120,000 Period Cost for the Period per Unit Months 37-42 335,000 4,455,000 1. If Winchester prices the motors at $375 each, how much operating income will Months 0-6 Design costs EA 500,000 Total variable costs the company make over the product's life cycle? What is the operating income Months 7-12 Production 1,300,000 $90 per unit Fixed costs: per unit? 20162500 2. Winchester is concerned about the operating income it will report in the first Marketing 1,000,000 sales phase. It is considering pricing the motor at $425 for the first 6 months Distribution 200,000 $10 per unit Months 7-12 50000 and decreasing the price to $375 thereafter. With this pricing strategy, Production 4,900,000 $70 per unit 2964000 Winchester expects to sell 9,500 units instead of 10,000 units in the first 6 Months 13-36 Months 13-36 months, 19,000 each year over the next 2 years, and 5,000 over the last 6 Marketing 2,325,000 Months 37-42 35000 months. Assuming the same cost structure given in the problem, which pricing strategy would you recommend? Explain. Distribution 700,000 $8 per unit Total fixed costs 24411500 Months 37-42 Production to 800,000 $60 per unit Life cycle operating income Marketing 475,000 Print Done Distribution 100,000 $7 per unit Ignore the time value of money. Print Done

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