I have provided answers. I only wish for explanations on how the answers are to be achieved.

Thank you!

2. Snappy Plants operates a commercial plant nursery where it propagates plants for garden centers throughout the region. Snappy Plants has $5,100,000 in assets. Its yearly fixed costs are $650,000, and the variable costs for the potting soil, container, label, scedling, and labor for each gallon-size plant total $1.90. Snappy Plants's volume is currently 500,000 units. Competitors offer the same plants, at the same quality, to garden centers for S4.25 each. Garden centers then mark them up to sell to the public for $9 to $12, depending on the type of plant. Read the requirements Requirement 1, Snappy Plants's owners want to earn an 11% return on investment on the company's assets. What is Snappy Plants's target full product cost? Revenue at current market price Less: Desired profit Target full product cost Requirement 2. Given Snappy Plants's current costs, will its owners be able to achieve their target profit? Begin by calculating Snappy Plants's current full product cost. Current variable costs Plus:Current fixed costs Current full product cost Snappy Plants's current full product costs are higher than its target full product cost, therefore Snappy Plants will not be able to acheive its target profit. $ 2,125,000 561,000 $ 1,564,000 $ 950,000 650,000 $ 1,600,000 Requirement 3. Assume Snappy Plants has identified ways to cut its variable costs to $1.75 per unit. What is its new target fixed cost? Will this decrease in variable costs allow the company to achieve its target profit? Begin by calculating Snappy Plants's new target fixed cost. Target full product cost Less Variable costs Target fixed cost Will this decrease in variable costs allow the company to achieve its target profit? $1,564,000 875,000 $689,000 Since the company's actual fixed costs are less than or equal to the new target fixed cost amount, Snappy Plants will cost cutting measures. be able to achieve its target profit without having to take any other Requirement 4. Snappy Plants started an aggressive advertising campaign strategy to differentiate its plants from those grown by other nurseries. Snappy Plants does not expect volume to be affected, but it hopes to gain more control over pricing. If Snappy Plants has to spend $105,000 this year to advertise and its variable costs continue to be $1.75 per unit, what will its cost-plus price be? Do you think Snappy Plants will be able to sell its plants to garden centers at the cost-plus price? Why or why not? Begin by calculating the cost-plus price per unit. (Round your answer to the nearest cent.) Current variable costs Plus: Full product cost Plus: Target revenue Divided by: Number of units Cost-plus price per unit Do you think Snappy Plants will be able to sell its plants to garden centers at the cost-plus price? Why or why not? $ 875,000 755,000 S 1,630,000 561,000 S 2,191,000 500,000 4.38 Fixed costs Desired profit If the advertising campaign is effective, Snappy Plants should previously charged be able to sell its plants to garden centers at this price because it is not significantly higher than the $4.25 that Snappy Plants