All else constant, what would Digbys SG&A/Sales ratio be if the company had spent an additional $1,500,000 for Drats promotional budget and $750,000 for Drats sales budget? Select: 1 9.2% 10.5% 11.0% 7.9%
Annual Report Round: 4 Dec. 31, 2023 Digby C59559 2023 Income Statement Deal Dell Na Na S52,197 $54,981 $0 $0 Na Na (Product Name:) Sales Dug $32,735 Drat $33,047 2023 Common Total Size $172,980 100.0% $0 $0 Nariable Costs: Direct Labor Direct Material nventory Carry Total Variable $3,394 $14,468 $170 $18,032 $3,459 $14,970 $192 $18,621 $10.549 $20,481 S469 $31,479 $9,804 $21,158 $573 $31,534 SO $0 SO $o SO $0 $0 $o SO SO SO $o SO SO SO SO $27,206 $71,056 $1,404 S99.668 15.796 41.196 0.896 57.896 Contribution Margin $14,703 $14,428 $20,718 $23,447 50 SO 8 50 $73,294 42.4% SO Period Costs: Depreciation SG&A: R&D Promotions Sales Admin Total Period $5.080 S446 $1,300 $1,600 S345 $8,751 $5,673 S448 $1,300 $1,600 S348 $9,367 $3.203 S908 $1,300 $1,400 S550 $7,510 $3.927 S966 $1,300 $1,400 S580 $8,172 SO SO $0 SO SO SO SO SO SO SO SO SO 888888 $17,953 S2,824 $5,200 $6,000 $1,823 $33,800 10.496 1.696 3.096 3.596 1.196 19.5% SO SO Net Margin $5,952 $5,058 $13,209 $15,275 $0 SO SO 50 $39,494 22.896 2.7% 20.196 2.39 7.4% 3.6% 0.196 6.6% Definitions: Sales: Unit sales times list price. Direct Labor: Labor costs incurred to produce the product that was sold. Inventory Carry Cost the cost to carry unsold goods in inventory Other $4,705 Depreciation: Calculated on straight-line 15-year depreciation of plant value. R&D Costs: R&D EBIT $34,789 department expenditures for each product. Admin: Administration overhead is estimated at 1.596 Short Term Interest $3,959 of sales. Promotions: The promotion budget for each product. Sales: The sales force budget for Long Term Interest $12.800 each product. Other. Charges not included in other categories such as Fees, Write Offs, and Taxes S6,307 TOM. The fees include money paid to investment bankers and brokerage firms to issue new Profit Sharing $234 stocks or bonds plus consulting fees your instructor might assess. Write-offs include the loss you Net Profit $11,479 might experience when you sell capacity or liquidate inventory as the result of eliminating a production line. If the amount appears as a negative amount, then you actually made money on Variable Margins the liquidation of capacity or inventory. EBIT: Earnings Before interest and Taxes. Short Term 2008 Digby interest: Interest expense based on last year's current debt, including short term debt, long term notes that have become due, and emergency loans. Long Term Interest: Interest paid on 40.0% outstanding bonds. Taxes: Income tax based upon a 35% tax rate. Profit Sharing: Profits shared with employees under the labor contract. Net Profit: EBIT minus interest, taxes, and profit 30.0% sharing 20.0% 10.0% 0.0%
