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I need help with the attached assignment. I need a tutor that's an accountant to help with assignment. Please do not plagiarsm!!!!!!!!!!!!!!!!!!!!!!!!!! Margins and Breakeven

I need help with the attached assignment. I need a tutor that's an accountant to help with assignment. Please do not plagiarsm!!!!!!!!!!!!!!!!!!!!!!!!!!

image text in transcribed Margins and Breakeven Analysis John has an idea for a new style of bicycle that he would like to introduce to the market. The manufacturing cost of the bicycle is $100 including packaging and shipping to wholesalers who will sell the product to retail stores. John's fixed costs (as the manufacturer and including all mass media advertising general administrative overhead) are expected to be $2,500,000 for the entire planning period (3 years), including a $1,000,000 advertising budget. No cost changes are anticipated over the planning period. John anticipates providing his own sales agents with a 3% commission on each unit sold. Competitors offer comparable bicycles for $500, and John feels the GPS system, backpedal brakes, and patented seat will give his produce competitive advantage. Typically, bicycle wholesalers take a 25% margin (mark-up) on costs and retailers seek a 40% margin on sales. John has set a profit goal of $1,000,000 for the planning period. Answer the following questions for each retail price level listed: $400, $500, $600, $700 Questions Units required for breakeven? Sales revenue required for breakeven? $ Units required for financial goal? Sales revenue required for financial goal? $ John's unit contribution to profitability? $ John's margin on costs? % Wholesaler Margin ($) per unit Retailer Margin ($) per unit Retail Price to the End User $400 $500 $600 $700 Please prepare answers for the following interpretative questions using your analyses above, and retail, wholesale, manufacturing data about bicycles from the US Bureau of the Census, and additional reputable data from Internet sources. 1. In the case description above, what are the fixed and what are the variable costs? 2. What would be a reasonable retail end-user price recommendation for John's bicycle? Justify your recommendation in market terms and in terms of John's financial goal. 3. How many units must be sold with your price recommendation to achieve John's financial goal? Is this realistic given your data on the market? 4. Is John's financial goal realistic? Justify your judgment in light of the data. 5. Given your retail price recommendation, how many units must be sold to achieve John's financial goal if he decides to give a $50 rebate as a new sales promotion to the first 200 end-user purchasers. Would this be a good promotion idea? Why? Ch3 Study Assignment Solution Questions Retail Price to End User $400 John's Units Required For Breakeven 28,989 John's Sales Revenue Required for Breakeven $5,565,888.00 John's Units Required for Financial Goal 40,585 John's Sales Revenue Required for Financial $7,792,320.00 Goal John's Unit Contribution to Profitability $86.24 John's Margin on Cost% 81.54% Wholesaler Margin ($) on Cost Per Unit $48.00 Retailer Margin ($) on Sales per Unit $160.00 Helpful Intermediate Calculations Retailer Cost (What the retailer pays the wholesaler) Wholesaler Cost (What John charges the wholesaler) John's Financial Goal Salesperson Commission ($) Total Variable Cost Per Unit Given Fixed Costs (including advertising and GAO) John's Desired Total Profit Variable Costs Manufacturing, Packaging, Shipping Salesperson Commission Wholesaler Required Margin on Cost % Retail Required Margin on Sales % $240.00 $192.00 $3,500,000.00 $5.76 $105.76 $2,500,000.00 $1,000,000.00 Note: Units must be rounded to next higher integer because you cannot sell part of a bicycle. $100.00 3.0% 25.0% 40.0% 500 600 700

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