Oakley Company manufactures and sells adjustable canopies that attach to motor homes and trallers. The market covers both new units os well os replacement canopies. Ookley developed its 202 business plan based on the assumption that canopies would sell at a price of $690 each. The variable cost of each canopy is projected at $490, and the annual fored costs are budgeted at $129,000. Ookley's after-tax profit objective is $303.000. and the compony's tax rate is 25 percent. While Ookley's soles usuolly rise during the second quorter, the Moy financial statements reported that soles were not meeting expectations. For the first five months of the year, only 640 units had been sold at the established price, with variable costs as planned. it was clear the 202 aftertax profit projection would not be reached unless some actions were taken. Oakley's president. Melanie Grand, assigned a management committee to analyze the situation and develop several altemative courses of action. The following mutually exclusive alternatives were presented to the president. - Reduce the sales price by $10. The sales organization forecasts that with the significantly reduced sales price, 5,600 units can be sold during the remainder of the year. Total foxed and variable unit costs will stsy as budgeted. - Lower variable costs per unit by $30 through the use of less expensive faw materials and slightly modified manufacturing techniques. The sales price also would be reduced by $35. and soles of 5.100 units for the remainder of the year are forecost. - Cut fixed costs by $12,900 and lower the sales price by 15 percent. Variable costs per unit will be unchanged. Sales of 4,900 units are expected for the remainder of the year. Requlred: 1. If no changes are made to the selling price or cost structure. determine the number of units that Oakley Compony must sell 2. In order to break even. b. To achieve its after-tax profit objective. 2. Determine which one of the ahernatives Oakley Company should select to achieve its annual after-tax profit objective. Complete this question by entering your answers in the tabs below. If no changes are made to the selling price or cost structure, determine the number of units that Oakley Company must sell (Do not round intermediate calculcations and round your final answers up to the nearest whole number.) a. In order to break even. b. To achieve its after-tax profit objective. Determine which ene of the alternatives Oakley company should select to achitve its annual after-tax profit objtctive. (Do not round intermediate calculations.) Jeffrey Vaughn, president of Frame-It Company, was just concluding a budget meeting with his senior staff. It was November of 200. and the group wos discussing preporotion of the firm's moster budget for 201. "lve decided to go ahead and purchase the industrial robot we've been talking about. We'll make the acquisition on January 2 of next year, and I expect it will take most of the year to train the personnel and reorganize the production process to take full advantage of the new equipment." In response to a question about financing the scquisition, Voughn replied as follows: "The robot will cost $1.220.000. We'll finance it with a one-year $1,220,000 loan from Shark Bank and Trust Company. Ive negotiated a repayment schedule of four equal instoliments on the last doy of each quarter. The interest rate will be 10 percent. and interest poyments will be quarterly as well" With that the meeting broke up, and the budget process was on. Frame-lt Company is a manufacturer of metal picture frames. The firm's two product lines are designated as S (small frames; 57 inches) and L (large frames; 810 inches). The primary raw materials are flexible metal strips and 9 -inch by 24-inch glass sheets. Each $ frame requires a 2-foot metal strip: an L frame requires a 3-foot strip. Allowing for normal breakage and scrap glass, Frame.lt can get either four S frames or two L frames ou of a glass sheec. Other faw materials, such os cardboard bocking. are insignificont in cost and are treoted os indirect moterials. Emily Jockson. Frame-lt's controller, is in charge of preparing the master budget for 20x1. She has gathered the following information: 1. Soles in the fourth quorter of 200 are expected to be 70.000S fromes and 60.000L fromes. The sales monager predicts that over the next two years, sales in each product line will grow by 4,000 units each quarter over the previous quartec. For example, 5 frame sales in the first quarter of 20x1 are expected to be 74,000 units. 2. Frame-lt's soles history indicates thet 60 percent of all ssles are on credit. with the remoinder of the soles in cosh. The company's collection experience shows that 80 percent of the credit sales are collected during the quarter in which the sale is made, while the remaining 20 percent is collected in the following quarter. (For simplicity, assume the company is able to collect 100 percent of its accounts receivabie.] 3. The $ frame selis for $12, and the L frame sells for $17. These prices are expected to hold constant throughout 20xL. 4. Frame-lt's production manager attempts to end each quarter with enough finished-goods inventory in each product line to cover 20 percent of the following quarter's sales. Moreover, an attempt is made to end each quarter with 20 percent, of the glass sheets needed for the following quarter's production. Since metal strips are purchased locally. Frame-it buys them on a just-in-time basis; inventory is negligible. 5. All of Frame-It's direct-material purchases are made on account, and 80 percent of each quarter's purchases are paid in cosh during the some quorter os the purchose. The other 20 percent is pold in the next quorter. 6. Indirect materials are purchased as needed and paid for in cash. Work-in-process inventory is negligible. 7. Projected production costs in 201 are as follows: 8. The predetermined overhesd rate is $10 per direct-labor hour. The following production overhead costs are budgeted for 201. 6. The predetermined overhead rate is $10 per direct-labor hour. The following production overhead costs are budgeted for 20x1 All of these costs will be paid in cash during the quarter incurred except for the depreciation charges. 9. Frameult's quarterly seling and administrative expenses are $111,000, paid in cash. 10. Jackson anticipates that dividends of $61,000 will be declared and paid in cash each quarter. 11. Frame-lt's projected balance sheet as of December 31, 20x0, follows: Requlred: 1. Prepare Frame-lt Company's sales budget for Q4(200) and 201 Oakley Company manufactures and sells adjustable canopies that attach to motor homes and trallers. The market covers both new units os well os replacement canopies. Ookley developed its 202 business plan based on the assumption that canopies would sell at a price of $690 each. The variable cost of each canopy is projected at $490, and the annual fored costs are budgeted at $129,000. Ookley's after-tax profit objective is $303.000. and the compony's tax rate is 25 percent. While Ookley's soles usuolly rise during the second quorter, the Moy financial statements reported that soles were not meeting expectations. For the first five months of the year, only 640 units had been sold at the established price, with variable costs as planned. it was clear the 202 aftertax profit projection would not be reached unless some actions were taken. Oakley's president. Melanie Grand, assigned a management committee to analyze the situation and develop several altemative courses of action. The following mutually exclusive alternatives were presented to the president. - Reduce the sales price by $10. The sales organization forecasts that with the significantly reduced sales price, 5,600 units can be sold during the remainder of the year. Total foxed and variable unit costs will stsy as budgeted. - Lower variable costs per unit by $30 through the use of less expensive faw materials and slightly modified manufacturing techniques. The sales price also would be reduced by $35. and soles of 5.100 units for the remainder of the year are forecost. - Cut fixed costs by $12,900 and lower the sales price by 15 percent. Variable costs per unit will be unchanged. Sales of 4,900 units are expected for the remainder of the year. Requlred: 1. If no changes are made to the selling price or cost structure. determine the number of units that Oakley Compony must sell 2. In order to break even. b. To achieve its after-tax profit objective. 2. Determine which one of the ahernatives Oakley Company should select to achieve its annual after-tax profit objective. Complete this question by entering your answers in the tabs below. If no changes are made to the selling price or cost structure, determine the number of units that Oakley Company must sell (Do not round intermediate calculcations and round your final answers up to the nearest whole number.) a. In order to break even. b. To achieve its after-tax profit objective. Determine which ene of the alternatives Oakley company should select to achitve its annual after-tax profit objtctive. (Do not round intermediate calculations.) Jeffrey Vaughn, president of Frame-It Company, was just concluding a budget meeting with his senior staff. It was November of 200. and the group wos discussing preporotion of the firm's moster budget for 201. "lve decided to go ahead and purchase the industrial robot we've been talking about. We'll make the acquisition on January 2 of next year, and I expect it will take most of the year to train the personnel and reorganize the production process to take full advantage of the new equipment." In response to a question about financing the scquisition, Voughn replied as follows: "The robot will cost $1.220.000. We'll finance it with a one-year $1,220,000 loan from Shark Bank and Trust Company. Ive negotiated a repayment schedule of four equal instoliments on the last doy of each quarter. The interest rate will be 10 percent. and interest poyments will be quarterly as well" With that the meeting broke up, and the budget process was on. Frame-lt Company is a manufacturer of metal picture frames. The firm's two product lines are designated as S (small frames; 57 inches) and L (large frames; 810 inches). The primary raw materials are flexible metal strips and 9 -inch by 24-inch glass sheets. Each $ frame requires a 2-foot metal strip: an L frame requires a 3-foot strip. Allowing for normal breakage and scrap glass, Frame.lt can get either four S frames or two L frames ou of a glass sheec. Other faw materials, such os cardboard bocking. are insignificont in cost and are treoted os indirect moterials. Emily Jockson. Frame-lt's controller, is in charge of preparing the master budget for 20x1. She has gathered the following information: 1. Soles in the fourth quorter of 200 are expected to be 70.000S fromes and 60.000L fromes. The sales monager predicts that over the next two years, sales in each product line will grow by 4,000 units each quarter over the previous quartec. For example, 5 frame sales in the first quarter of 20x1 are expected to be 74,000 units. 2. Frame-lt's soles history indicates thet 60 percent of all ssles are on credit. with the remoinder of the soles in cosh. The company's collection experience shows that 80 percent of the credit sales are collected during the quarter in which the sale is made, while the remaining 20 percent is collected in the following quarter. (For simplicity, assume the company is able to collect 100 percent of its accounts receivabie.] 3. The $ frame selis for $12, and the L frame sells for $17. These prices are expected to hold constant throughout 20xL. 4. Frame-lt's production manager attempts to end each quarter with enough finished-goods inventory in each product line to cover 20 percent of the following quarter's sales. Moreover, an attempt is made to end each quarter with 20 percent, of the glass sheets needed for the following quarter's production. Since metal strips are purchased locally. Frame-it buys them on a just-in-time basis; inventory is negligible. 5. All of Frame-It's direct-material purchases are made on account, and 80 percent of each quarter's purchases are paid in cosh during the some quorter os the purchose. The other 20 percent is pold in the next quorter. 6. Indirect materials are purchased as needed and paid for in cash. Work-in-process inventory is negligible. 7. Projected production costs in 201 are as follows: 8. The predetermined overhesd rate is $10 per direct-labor hour. The following production overhead costs are budgeted for 201. 6. The predetermined overhead rate is $10 per direct-labor hour. The following production overhead costs are budgeted for 20x1 All of these costs will be paid in cash during the quarter incurred except for the depreciation charges. 9. Frameult's quarterly seling and administrative expenses are $111,000, paid in cash. 10. Jackson anticipates that dividends of $61,000 will be declared and paid in cash each quarter. 11. Frame-lt's projected balance sheet as of December 31, 20x0, follows: Requlred: 1. Prepare Frame-lt Company's sales budget for Q4(200) and 201