Answered step by step
Verified Expert Solution
Question
1 Approved Answer
i need answers asap Background facts Nichole Mustard and Credit Karma are introduced in the chapter's opening feature. Assume that they are considering two options.
i need answers asap
Background facts Nichole Mustard and Credit Karma are introduced in the chapter's opening feature. Assume that they are considering two options. Plan A. The company would begin selling access to a premium version of its website. The new online customers would use their credit cards. The company has the capability of selling the premium service with no additional investment in hardware or software. Annual credit sales are expected to increase by $248,000. Costs associated with Plan A: Additional wages related to these new sales are $135,700; credit card fees will be 4.75% of sales; and additional record keeping costs will be 6% of sales. Premium service sales will reduce advertising revenue by $8,550 annually because some customers will now only use the premium service. Plan B. The company would begin selling merchandise. It would make additional annual credit sales of $502,000. Costs associated with Plan B: Cost of these new sales is $374,000. Record keeping and shipping costs will be 00 of sales and uncollectible The company would begin selling merchandise. It would make additional annual credit sales of $502,000. Costs associated with Plan B: Cost of these new sales is $374,000. Record keeping and shipping costs will be 4.0% of sales; and uncollectible accounts will be 6.2% of sales. Required Post #1. Compute the additional annual net income or loss expected under (a) Plan A and (b) Plan B. In your first post show your computations and the expected additional net income or loss amount. Include your work and your solution to both plans. Post #2. You will now have access to your classmates' calculations and results. First, be sure your amounts agree. If not, check to be sure yours are correct. Next, answer this question in your second post: Should the company pursue either plan? In this second post, announce your decision and discuss your opinion regarding the financial and non-financial factors relevant to your decision Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started