Cost Structure;Break-Even and Target Profit AnalysisFirst use the correct answers to write the case study report. Answer each question as if you were a consultant hired by the company and are presenting to the president. For each answer explain the terminology and concepts used. For example, in #1 rather than just give the breakevenfor each scenario, explain the change in the volume of sales, explain the calculation - this is a professional report from a consultant to an executive committee.
If used outside sources, please cite them
When giving a recommendation, back it up with numbers.
Cheryl Montoya picked up the phone and called her boss, Wes Chan, the vice president of marketing at Piedmont Fasteners Corporation: \"Wes, I'm not sure how to go about answering the questions that came up at the meeting with the president yesterday." "What's the problem?\" \"The president wanted to know the breakeven point for each of the company's products, but I am having trouble figuring them out." \"I'm sure you can handle it, Cheryl. And, by the way, I need your analysis on my desk tomorrow morning at 8:00 sharp in time for the followup meeting at 9:00." Piedmont Fasteners Corporation makes three different clothing fasteners in its manufacturing facility in North Carolina. Data concerning these products appear below: Velcro Metal Nylon Annual sales volume 187,880 265,880 319,800 Unit selling price 5 2.20 5 2.86 $ 1.4-0 Variable expense per unit 5 1.60 $ 1.36 $ 1.20 Total xed expenses are $258,000 per year. All three products are sold in highly competitive markets, so the company is unable to raise prices without losing an unacceptable numbers of customers. The company has an extremely effective lean production system, so there are no beginning or ending work in process or nished goods inventories. Required: 1. What is the company's overall breakeven point in dollar sales? 2. Of the total xed expenses of $258,000, $30,480 could be avoided if the Velcro product is dropped. $115,500 if the Metal product is dropped, and $38,400 if the Nylon product is dropped. The remaining xed expenses of $3,620 consist of common xed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely. a. What is the break-even point in unit sales for each product? b. If the company sells exactly the brea keven quantity of each product, what will be the overall prot of the company? Complete this question by entering your answers in the labs below. Answer is complete and correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 28 What is the company's overall break-even point in dollar sales? (Round CM ratio to 4 decimal places and final answer to the nearest thousand dollars. Break-even point in dollar sales 839,038 Required 1 Required 2A Required 28 Of the total fixed expenses of $258,000, $30,480 could be avoided if the Velcro product is dropped, $115,500 if the Metal product is dropped, and $38,400 if the Nylon product is dropped. The remaining fixed expenses of $73,620 consist of common fixed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely. What is the break-even point in unit sales for each product? (Do not round intermediate calculations.) Show lessA Velcro Metal Nylon Break-even point in unit sales 25,400 165,000 192,000 Answer is complete and correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 28 Of the total fixed expenses of $258,000, $30,480 could be avoided if the Velcro product is dropped, $115,500 If the Metal product is dropped, and $38,400 if the Nylon product is dropped. The remaining fixed expenses of $73,620 consist of common fixed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely. If the company sells exactly the break-even quantity of each product, what will be the overall profit of the company? Show lessA Net operating loss $ 73.620
