Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

First, you have decided to divide the nation into two regions with a regional sales manager in charge of each. According to industry sources, a

First, you have decided to divide the nation into two regions with a regional sales manager in charge of each. According to industry sources, a regional sales manager's average sales is $120,000. Second, a number of district managers will be needed to manage the salespeople directly. A span of control of 10:1 (10 salespeople to 1 manager) is believed to be necessary. Salaries for district managers average $90,000. Incentive pay for managers, both regional and district, is expected to be 0.35 percent of sales. Third, it should cost $12,000 to recruit and train each salesperson. Finally, management wants sales to grow by 10 percent next year to $220 million, so more than 100 salespeople will need to be hired. Average sales per salesperson are expected to be $2 million. 

Given this new information, which type of sales force will be less expensive? What is the breakeven sales volume now?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Regional Sales Managers There are 2 regional sales managers each with a salary of 120000 Their total ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial and Managerial Accounting

Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren

11th Edition

9780538480901, 9781111525774, 538480890, 538480904, 1111525773, 978-0538480895

More Books

Students also viewed these Accounting questions