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Plz help asap! Due to erratic sales of its sole product-a high-copacity battery for laptop compiters-PEM, lnc, has been experiencing financial datficulty for some time.
Plz help asap! Due to erratic sales of its sole product-a high-copacity battery for laptop compiters-PEM, lnc, has been experiencing financial datficulty for some time. The company's contribution format income statement for the most recent month is given below: Pequired: 1. Compute the company's CM rato and its break-even point in unit sales ond doliar solos 2. The president believes that a 56,400 increase in the monthly advertising budgot combined with an intensified effort by the sales stoff, will result in an $83,000 increase in monthly sales. If the president is right, what wil be the increase (decrease) in the company's imonthly oot operating income? 3. Refer to the criginal data. The sales manoger is convinced that a 10% reduction in the selling price, combined with an increase of $33,000 in the monthly advertising budget, will double unit sales, If the sales manager is right, what will be the revised net operating income (lossip? 4. Refer to the original dota. The Makketing Department thiniks that a fancy new packoge for the laptop computer battery would grow sales. The new package would incresse pockaging costs by 50.60 por unit. Assuming no other changes, how maniy units would have to be sold eech month to attain a target proht of $4,600 ? 5. Refer to the original data, By butomating, the compony could reduce voriable expenses by $3 per unit. However, fixed expenses would increase by $57,000 eoch month. a. Compute the new CM ratio and the now break-tiven point in unit soies and dollar solesh b. Assume that the compary expects to sell 20,900 unis nent month. Prepore two contribution format income statements, one assuming that operations are not outocmoted and one assuming that they are. (5how data on a per unit and porcentage basis, as well is in totat, for each alternative.) c. Would you recommend that the compony automate its oporations (Assuming that the compatiy expects to seit 20,900)
Plz help asap!
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