Question
If the company reduced price by 5% and got a 10% increase in sales volume, what would be the expected net profit? Given the following:
If the company reduced price by 5% and got a 10% increase in sales volume, what would be the expected net profit?
Given the following: Accounts receivable (starting) $800,000 Advertising $1,000,000 Cost of good sold $9,200,000 Depreciation expense $440,000 Insurance $200,000 Interest $420,000 Inventory (starting) $2,600,000 Labor expense $1,200,000 Loan principal payments $600,000 Management compensation $800,000 Miscellaneous expense $600,000 Owner's equity $4,000,000 Purchases of inventory $9,000,000 Receipts on accounts receivable $11,800,000 Rent $800,000 Sales (cash) $4,000,000 Sales (credit) $12,000,000 Utilities $240,000
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