P7-65A (similar to) w score of 20 pes Combo g se Requirements icome 1. Prepare the company's current contribution margin income statement. 2. Calculate the change in operating income that would result from implementing each of the following independent strategy alternatives. Compare each alternative to the current operating income as you calculated in Requirement 1. Consider each alternative separately. a. Alternative 1: The company believes volume will increase by 10% if salespeople are paid a commission of 15% of the sales price rather than the current $6 per unit. b. Alternative 2: The company believes that spending an additional $1,000 on advertising would increase sales volume by 15%. c. Alternative 3: The company is considering raising the selling price to $85, but believes volume would drop by 30% as a result. d. Alternative 4: The company would like to source the product from domestic suppliers who charge $8 more for each unit. Management believes that the "Made in the USA" label would increase sales volume by 10% and would allow the company to increase the sales price by $10 per unit. In addition, the company would have to spend an additional $1.000 in marketing costs to get the word out to potential customers of this change. Print Done nswer. UN Question Holo P7-65A (similar to) Formal Seng Company is current sing 2.400 v ed bean bag has a month at a price of 375 per chi The variable cost of each chairsold includes $45 to purchase the bean bag chairs from support and as Fixed costs are $11.000 per month The company is considering making several operational changes and wants to know how the change will impact itseptig income a com Read morts m ent (Use parentes orams i forandring Requirement. Pregarthe company's current contribution margin com Formal Sewing Company Cost of good Our expenses 4 of 6 (0 complete) mais a month at a price of $75 per chair. The variable cost of each chair sold includes $45 to pura ses Requirements some 1. Prepare the company's current contribution margin income statement. 2. Calculate the change in operating income that would result from implementing each of the following independent strategy alternatives. Compare each alternative to the current operating income as you calculated in Requirement 1. Consider each alternative separately. a. Alternative 1: The company believes volume will increase by 10% if salespeople are paid a commission of 15% of the sales price rather than the current $6 per unit. b. Alternative 2: The company believes that spending an additional $1,000 on advertising would increase sales volume by 15%. C. Alternative 3: The company is considering raising the selling price to $85, but believes volume would drop by 30% as a result. d. Alternative 4: The company would like to source the product from domestic suppliers who charge $8 more for each unit. Management believes that the "Made in the USA label would increase sales volume by 10% and would allow the company to increase the sales price by $10 per unit. In addition, the company would have to spend an additional $1,000 in marketing costs to get the word out to potential customers of this change. Print Done Answer Clear All Q Search or type URL