PROBLEM 5.

Pricing Decision As pandemic situation runs quite long, Norman plans to build a rental family swimming pool to expand his business. Here is the information for the business plan.

Required: 1. Calculate the operating income, full cost of the product. 2. Set the price based on the information 3. Prove your answer by showing the income statement 4. Norman predicts that if he adds the marketing expense by 5% of the price per package, the package sold can increase by 9%. Should he spend addition marketing fee?

Performance Evaluation Using the information and results of the questions above (not included requirement 4), assume that the price is Rp275.000 and the package sold is 480 packages. 5. Compute the ROI (5%) 6. Compute the Residual Income (5%)

Investment Rp 250.000.000 12% targeted ROI 30% markup on full cost expected package sales variable cost/package 500 Rp25.000