Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Kingbird Inc. has been producing basketballs, volleyballs, soccer balls, and footballs for many years. Its manager, Jake, just came up with the idea to sell
Kingbird Inc. has been producing basketballs, volleyballs, soccer balls, and footballs for many years. Its manager, Jake, just came up with the idea to sell products in a bundle to provide more options for buyers. Jake's suggestion is to sell a bundle of balls (one of each of the four types listed, above) for $51. This represents a savings to the consumer of 15% off regular, individual prices for the items. The company has been operating within its target cost for all of these products, which have a combined total of $33 per bundle. The proposal includes a target sales volume of 10,000 bundles. (a) Your answer is correct. If Kingbird requires an ROI of 20% on its invested assets, what amount of invested assets must the company currently have? Asset base $ (b) Your answer is correct. If Kingbird recognizes that it will need to invest in at least two new pieces of equipment (at a total cost of $131,000 ) in the coming year to facilitate this bundling process, what will be the new target cost per unit? (Round answer to 2 decimal places, e.g. 15.25.) New target cost per unit $ Your answer is incorrect. If Kingbird finds that it has to drop its target selling price to $51.00 to really promote this bundle, what ROI will the company earn, incorporating the new target cost per unit from part (b)? (Round answer to 2 decimal places, e.g. 15.25\%.) ROI %
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started