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(I) You have just been appointed the product manager of the Warmo electric blankets in a large consumer products company. As part of your new
(I) You have just been appointed the product manager of the "Warmo" electric blankets in a large consumer products company. As part of your new job, you want to develop an understanding of the financial situation for your product. Your brand assistant has provided you with the following facts: $1 per a. Retail selling price b. Retailer's margin c. Jobber's margin d. Wholesaler's margin! e. Direct factory labor f. Raw materials g. All factory and administrative overheads h. Salesperson's commissions . Sales force travel costs j. Advertising k. Total market for electric blankets 1. Current yearly sales of "Warmo" $40 per unit 25% 12% 20% $2 per unit unit $2.7 per unit (if unit volume = 100,000) 10% of manufacturer's selling price $232,000 $800,000 1 million units 210,000 units Questions 1. What is the contribution per unit for the "Warmo" brand?2 2. What is the break-even-volume in units and in dollars? 3. What market share does the Warme brand need to break even? 4. What is the current total contribution? 5. What is the current before-tax profit of the Warmo brand? 6. What market share must Warmo obtain to contribute a before tax profit of exactly $6 million
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