Please provide formulas for each answer. Thank you!
Question 2 Parts A and B Please remember to highlight your answers and show all work Alcove Hardware, Prescott Industries, and Clearview Home Products manufacture and sell storm windows. Their average selling prices, variable and fixed costs are shown below. Alcove Prescott Clearview Units Sold 254,500 125,700 432,550 Average Selling Price ($s/unit) $73.00 $150.00 $70.25 Variable Cost ($s/unit) $47.20 $66.25 $35.65 Fixed Costs $2,954,500 $553,800 $2,803,250 Part A (0) Calculate the revenues, total cost/unit, gross profit and gross profit margin for the three companies (ii) What does the above calculation suggest about each companies strategy and competitive position? Part B Alcove has brought in a new management team charged with improving the company's profit ($s). Two alternatives have been identified: cut prices, shut down one of Alcove's manufacturing facilities. (1) Cut selling price alternative Cut Alcove's average selling price $70.25 the same as Clearview's How much sales volume (units) would Alcove have to generate to have the gross profit $s as in Part A? (ii) Close manufacturing facility Closing manufacturing facility would reduce fixed costs to With this alternative Alcove would maintain their price at Variable cost/unit does not change $1,881,050 $73.00 How much sales volume (units) would Alcove have to generate to have the gross profit $s as in Part A? Question 2 Parts A and B Please remember to highlight your answers and show all work Alcove Hardware, Prescott Industries, and Clearview Home Products manufacture and sell storm windows. Their average selling prices, variable and fixed costs are shown below. Alcove Prescott Clearview Units Sold 254,500 125,700 432,550 Average Selling Price ($s/unit) $73.00 $150.00 $70.25 Variable Cost ($s/unit) $47.20 $66.25 $35.65 Fixed Costs $2,954,500 $553,800 $2,803,250 Part A (0) Calculate the revenues, total cost/unit, gross profit and gross profit margin for the three companies (ii) What does the above calculation suggest about each companies strategy and competitive position? Part B Alcove has brought in a new management team charged with improving the company's profit ($s). Two alternatives have been identified: cut prices, shut down one of Alcove's manufacturing facilities. (1) Cut selling price alternative Cut Alcove's average selling price $70.25 the same as Clearview's How much sales volume (units) would Alcove have to generate to have the gross profit $s as in Part A? (ii) Close manufacturing facility Closing manufacturing facility would reduce fixed costs to With this alternative Alcove would maintain their price at Variable cost/unit does not change $1,881,050 $73.00 How much sales volume (units) would Alcove have to generate to have the gross profit $s as in Part A
