Gle's counter Geconsider vestir 5130,000 into a new store in Palm Springs. He expects the store in Palm Springs to pertemuh me more expensive of sexsting store in Goodye. Glenn thinks ha COGS per case in Palm Sprei will be the opere at the Goodyear to, but he expects higher labor rent and wollty cost Dractions for a fos Projections for year 1 tupene Goodyear Palm Springs COGS 3336250 Same COGS per cases Goodyear Bent 560.000 30. Ngher than rent in Goodyear Labor $207360 25% her that Labor in Goodyear $18,000 Xher than utilities in Goodyear Last year the Gover torso 13.000 ton were price of 575/cace Breskensal Gencemed about strong competitors in the Palm Springs area. He is determined to keep the price per case at 5. but he world that the stone will be not be able to achieve 13,000 cases in the first year at this price. Glenn has hives you come to help him estimate the number of cases he would need to sell at the Palm Springs store next pear to break even in this means that he wilcover his operating expenses (COGS, Rent, Labor and rating amings Before Tess evement recovery Co warehow god he will recover $530,000 in in the Palm Springstore Sales at the Goodyesore rowerowa na tatal stouts per year, but he is not optimistic about being able to maintain todo powth rate with the competition is alsongs. He has bied you as a consultant to help him determine what growthreaded to recover the investment in artes you to make the following on the projections for next year shown above Ale that eat year you will sell the best mount of cases There will stay the higher than utilities incool Labor 3207160 STR.000 Last year the Goodyear store sold 12.000 cases at an average price of 575/case Genes concerned about stronger competitors in the Palm Springs area. He is determined to keep the price per case at $75. but he is worried that the store will be not be able to achieve 13,000 cases in the first year at this price. Glenn has hired you a consultant to help him estimate the number of cases he would need to sell at the Palm Springs store next year to break even trek even in this sense means that he will cover his operating expenses (COGS, Rent, Labor and te generating Emines Before Tones 50 Investment recovery Glenn also wants to see how quickly he wil recover his $130,000 investment in the Palm Springs store. Sales at the Goodyear store have grown at an annual rate of about 7% per year, but he is not optimistic about being able to maintain that kind of prowth rate with all the competition in Palm Springs. He has hired you as a consultant to help him determine what growth rate is needed to recover the initial investment in 5 years. Glenn ask you to make the following sumption, starting with his projections for next year shown above Assume that next year you will sell the break-even amount of cases The price perse will stay the same for all years COGS per case will stay the same for all years After year 1. Labor costs will increase 2% per year! After year 1. Utilities will increase per year Glenn was able to negotiate a long-term lease, so rent will stay the same for 5 years Taxate ON Find the growth rate needed to recover the investment in Syears. Recovering the investment means net income cost of the investment TO 1114 OD Proposed project Palm Springs Store Proposed polect: Palm Sprines Store 510 Price COG Gond 13.000 5750 330250 16000 30 Smood bo 200 250.200 10 COSE be teeth lung Dule 2 4 6 Q tab W E m R T T Y Caps lock A S D F G 02 H N X C V B N control option cmd TRE OOL Teme ) 11 B Proposed project Palm Springs Store Proposed project Palm Springs Store 2 Toured SC Goodyear 12000 575.00 $53525 160.000 STO 000 SOU 1 Calciate the break even smber of Cases 1 000 S23200 114 11 1 19 NO 5412 20 2 Cheden 3 4 5 Q W E R R Tab T Y U caps fack A S D D F G G . H N Z X C V 00 B N control option cmd Ale Proposed project Palm Spring Store D Code Categwieded to prevent rodrow HE C more . D Question 1 2.5 pts How many cases would Glenn need to sell at the Palm Springs store next year to break even? 0.10,700 4515 8755 13000 Question 2 5 pts At what should the sale of cases grow in order to recover the initial investment in 5 years? 6 3 4 5 6 8 0 E R T U U DF G H L CV B N M Gle's counter Geconsider vestir 5130,000 into a new store in Palm Springs. He expects the store in Palm Springs to pertemuh me more expensive of sexsting store in Goodye. Glenn thinks ha COGS per case in Palm Sprei will be the opere at the Goodyear to, but he expects higher labor rent and wollty cost Dractions for a fos Projections for year 1 tupene Goodyear Palm Springs COGS 3336250 Same COGS per cases Goodyear Bent 560.000 30. Ngher than rent in Goodyear Labor $207360 25% her that Labor in Goodyear $18,000 Xher than utilities in Goodyear Last year the Gover torso 13.000 ton were price of 575/cace Breskensal Gencemed about strong competitors in the Palm Springs area. He is determined to keep the price per case at 5. but he world that the stone will be not be able to achieve 13,000 cases in the first year at this price. Glenn has hives you come to help him estimate the number of cases he would need to sell at the Palm Springs store next pear to break even in this means that he wilcover his operating expenses (COGS, Rent, Labor and rating amings Before Tess evement recovery Co warehow god he will recover $530,000 in in the Palm Springstore Sales at the Goodyesore rowerowa na tatal stouts per year, but he is not optimistic about being able to maintain todo powth rate with the competition is alsongs. He has bied you as a consultant to help him determine what growthreaded to recover the investment in artes you to make the following on the projections for next year shown above Ale that eat year you will sell the best mount of cases There will stay the higher than utilities incool Labor 3207160 STR.000 Last year the Goodyear store sold 12.000 cases at an average price of 575/case Genes concerned about stronger competitors in the Palm Springs area. He is determined to keep the price per case at $75. but he is worried that the store will be not be able to achieve 13,000 cases in the first year at this price. Glenn has hired you a consultant to help him estimate the number of cases he would need to sell at the Palm Springs store next year to break even trek even in this sense means that he will cover his operating expenses (COGS, Rent, Labor and te generating Emines Before Tones 50 Investment recovery Glenn also wants to see how quickly he wil recover his $130,000 investment in the Palm Springs store. Sales at the Goodyear store have grown at an annual rate of about 7% per year, but he is not optimistic about being able to maintain that kind of prowth rate with all the competition in Palm Springs. He has hired you as a consultant to help him determine what growth rate is needed to recover the initial investment in 5 years. Glenn ask you to make the following sumption, starting with his projections for next year shown above Assume that next year you will sell the break-even amount of cases The price perse will stay the same for all years COGS per case will stay the same for all years After year 1. Labor costs will increase 2% per year! After year 1. Utilities will increase per year Glenn was able to negotiate a long-term lease, so rent will stay the same for 5 years Taxate ON Find the growth rate needed to recover the investment in Syears. Recovering the investment means net income cost of the investment TO 1114 OD Proposed project Palm Springs Store Proposed polect: Palm Sprines Store 510 Price COG Gond 13.000 5750 330250 16000 30 Smood bo 200 250.200 10 COSE be teeth lung Dule 2 4 6 Q tab W E m R T T Y Caps lock A S D F G 02 H N X C V B N control option cmd TRE OOL Teme ) 11 B Proposed project Palm Springs Store Proposed project Palm Springs Store 2 Toured SC Goodyear 12000 575.00 $53525 160.000 STO 000 SOU 1 Calciate the break even smber of Cases 1 000 S23200 114 11 1 19 NO 5412 20 2 Cheden 3 4 5 Q W E R R Tab T Y U caps fack A S D D F G G . H N Z X C V 00 B N control option cmd Ale Proposed project Palm Spring Store D Code Categwieded to prevent rodrow HE C more . D Question 1 2.5 pts How many cases would Glenn need to sell at the Palm Springs store next year to break even? 0.10,700 4515 8755 13000 Question 2 5 pts At what should the sale of cases grow in order to recover the initial investment in 5 years? 6 3 4 5 6 8 0 E R T U U DF G H L CV B N M