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I need help please Clipboard Font Alignment F26 fx B D E F G H 1 3 Please complete the Problem as follows: 4 5
I need help please
Clipboard Font Alignment F26 fx B D E F G H 1 3 Please complete the Problem as follows: 4 5 1) This year Blanko Company earned a disappointing 4.40% after-tax return on sales (Net Income/Sales) from 6 marketing 50,000 units of its only product. The company buys its product in bulk and repackages it for resale at the 7 price of $20 per unit. Blanko incurred the following costs this year. 8 9 Total variable unit costs $ 400,000 10 Total variable packaging costs $ 50,000 11 Fixed costs $ 495,000 12 Income tax rate 20% 13 14 The marketing manager claims that next year's results will be the same as this year's unless some changes are 15 made. The manager predicts the company can increase the number of units sold by 60% if it reduces the selling 16 price by 20% and upgrades the packaging. This change would increase variable packaging costs by 20%. Increased 17 sales would allow the company to take advantage of a 25% quantity purchase discount on the cost of the bulk 18 product. Neither the packaging change nor the volume discount would affect fixed costs, which provide an annual 19 output capacity of 100,000 units. 20 21 Required 22 1- Compute the break-even point in dollar sales under the (a) existing business strategy and (b) new strategy that 23 alters both unit sales price and variable costs. 24 25 Use the following format to start your calculation: 26 27 Detail of current strategy per unit: 8 Per Unit 9 Sales 20.00 0 Variable unit cost 1 Variable packaging cost 2. Contribution margin 3 4 Detail of new strategy per unit: Per Unit 6 Sales 16.00 7 Variable unit cost B Variable packaging cost Contribution margin PR BYN Class Notes In-class Problem + Select destination and press ENTER or choose Paste Type here to search TDLStep by Step Solution
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