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Elliott Trophies makes three types of awards for organizations to give employees or team members. The following are its prices and costs: Sport Employee
Elliott Trophies makes three types of awards for organizations to give employees or team members. The following are its prices and costs: Sport Employee Celebrity Price per Variable Cost per Units Sold per Year Unit $ 24 80 656 Req A Unit $ 16 Fixed costs of $432,000 per year Include building and equipment costs, marketing costs, and the costs of administration. Elliott Trophies is subject to a 21 percent tax rate on income. Req B 68 516 Required: a. Given this information, how much will Elliott Trophies earn each year after taxes? b. Assuming the given sales mix is the same at the break-even point, at what sales revenue does Elliott Trophies break even? c. Assuming the given sales mix, at what sales revenue will the company earn $276,500 per year after taxes? d. Elliott Trophies is concerned about the future of the Celebrity trophy market, given recent cost-cutting by companies and is considering becoming more specialized in the Sport and Employee market. If Elliott Trophies drops the Celebrity model, fixed costs will fall to $402,000 per year. If It follows through with this plan, Elliott Trophies expects that the relative sales mix between the Sport and Employee models will remain the same. That is, for every 36,000 units of the Sport model sold, Elliott Trophies would expect to sell 9,000 units of the Employee model. How many units of the Sport and Employee models would Elliott Trophies have to sell to achieve the same after-tax Income it currently earns with the three models? Complete this question by entering your answers in the tabs below. Req C 36,000 9,000 3,000 Reg D Given this information, how much will Elliott Trophies earn each year after taxes? Earnings < Req A Req B > Req A Req B Break-even revenue Req C Req D Assuming the given sales mix is the same at the break-even point, at what sales revenue does Elliott Trophies break even? Note: Do not round intermediate calculations. < Req A Req C > Req A Req B Sales revenue Req C Req D Assuming the given sales mix, at what sales revenue will the company earn $276,500 per year after taxes? < Req B Req D > Elliott Trophies is concerned about the future of the Celebrity trophy market, given recent cost-cutting by companies and is considering becoming more specialized in the Sport and Employee market. If Elliott Trophies drops the Celebrity model, fixed costs will fall to $402,000 per year. If it follows through with this plan, Elliott Trophies expects that the relative sales mix between the Sport and Employee models will remain the same. That is, for every 36,000 units of the Sport model sold, Elliott Trophies would expect to sell 9,000 units of the Employee model. How many units of the Sport and Employee models would Elliott Trophies have to sell to achieve the same after-tax income it currently earns with the three models? Note: Do not round your intermediate calculations. Sport model Employee model < Req C Req D > Show less
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