Question
I NEED THE ANSWERS FOR F, G1, G2 AND H1. THE OTHER ARE ALREADY ANSWERED. THANK YOU Monterey Co. makes and sells a single product.
I NEED THE ANSWERS FOR F, G1, G2 AND H1. THE OTHER ARE ALREADY ANSWERED. THANK YOU
Monterey Co. makes and sells a single product. The current selling price is $15 per unit. Variable expenses are $9 per unit, and fixed expenses total $31,900 per month. (Unless otherwise stated, consider each requirement separately.)
a. Calculate the break-even point expressed in terms of total sales dollars and sales volume. (Do not round intermediate calculations.)
break even sales = 79750
break even volume = 5317 units
b. Calculate the margin of safety and the margin of safety ratio. Assume current sales are $94,750. (Do not round intermediate calculations. Round your percentage answer to 2 decimal places.)
Margin of safety = 15000
Margin of safety of ratio = 15.83 %
c. Calculate the monthly operating income (or loss) at a sales volume of 5,150 units per month. (Do not round intermediate calculations.)
-1000
d. Calculate monthly operating income (or loss) if a $2 per unit reduction in selling price results in a volume increase to 8,300 units per month. (Do not round intermediate calculations.)
1300
f. Calculate the monthly operating income (or loss) that would result from a $1 per unit price increase and a $6,000 per month increase in advertising expenses, both relative to the original data. Assume a sales volume of 5,150 units per month. (Do not round intermediate calculations.)
Management is considering a change in the sales force compensation plan. Currently each of the firm's two salespeople is paid a salary of $2,500 per month.
g-1. Calculate the monthly operating income (or loss) that would result from changing the compensation plan to a salary of $400 per month, plus a commission of $0.75 per unit, assuming a sales volume of 5,150 units per month. (Do not round intermediate calculations.)
g-2. Calculate the monthly operating income (or loss) that would result from changing the compensation plan to a salary of $400 per month, plus a commission of $0.75 per unit, assuming a sales volume of 6,350 units per month. (Do not round intermediate calculations. Losses should be indicated by a minus sign.)
h-1. Assuming that the sales volume of 6,350 units per month achieved in part g could also be achieved by increasing advertising by $1,000 per month instead of changing the sales force compensation plan. What would be the operating income or loss? (Do not round intermediate calculations. Losses should be indicated by a minus sign.)
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