First - answer the case study 2-32 in McGraw Hill Connect. Then, use the correct answers to write the case study report. The actual case study in McGraw Hill Connect is worth 10 points. I have given you unlimited opportunities to get the correct answers on the case study in Connect. The remainder of the 50 points comes from your 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 breakeven for 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. Use outside sources when necessary BUT MAKE SURE YOU CITE THEM! When giving a recommendation, back it up with numbers. This particular answer should be an executive committee report that is no more than 4 pages in length. 1 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?" 10/10 points awarded "The president wanted to know the break-even point for each of the company's products, but I am having trouble figuring them out." Scored "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 follow-up meeting at 9:00." eBook Piedmont Fasteners Corporation makes three different clothing fasteners in its manufacturing facility in North Carolina. Data concerning these products appear below: Print References Annual sales volume Unit selling price Variable expense per unit Velcro 109,000 $1.40 $0.80 Metal 215,000 $1.80 $1.10 Nylon 304,000 $1.50 $1.00 Total fixed expenses are $273,000 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 finished goods inventories. Required 1 Required 2A Required 2B 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 $ 738,836 Required 1 Required 2A Required 2B of the total fixed expenses of $273,000, $13,500 could be avoided if the Velcro product is dropped, $121,800 if the Metal product is dropped, and $92,500 if the Nylon product is dropped. The remaining fixed expenses of $45,200 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 less Velcro Metal Break-even point in unit sales Nylon 185,000 22,500 174,000
