SnowDelight operes a Rocky Mountain ski reson. The company is planning is in ticket pricing for the coming a season. Investors would like to earn a 15% retum on the company's 500 million of ots. The company incurs primarily fixed costs to groom the runs and operate the line ShowDelight projects foed costs to be $33,750,000 for the season. The resort serves about 750.000 kr and snowboarders each sonson. Variable costs are $10 per guest. The resort had such a favorable reputation among skers and snowboarders that it had some control over the ticket prices Astute that SnowDeligh's reputation has diminished and other resorts in the vicinity are charyng only 565 per it icket SnowDelight has become a pricker and won't be able to charge more than its competitors. Al the market price, SnowDello's managers believe they will still cerve 750.000 skers and inowboardersachsen Read the air inwDelight can't reduce costs, what probt will come your answer in dollars and as a percent of assets. Will investors be hapoy with the prott vol7 Show your analyse Complete the following table to calculate Snowlights projected income and excess profit or shortat (reporuth or a minusuig to show a proto short Revenue in market price Los Total Operating income Compared to the desidering income of Expected excess proftro shortfall wo shortfall.) Requirements of 1. If SnowDelight can't reduce its costs, what profit will it earn? State your answer in dollars and as a percent of assets. Will investors be happy with the profit level? Show your analysis. 2. Assume that SnowDelight has found ways to cut its fixed costs to $30 million. What is its new target variable cost per skier/snowboarder? Compare this to the current variable cost per skier/snowboarder. Comment on your results. Print Done Garden House operates a commercial plant nursery where it propagates plants for garden centers throughout the region Garden House has $4.9 million in assets. Its yearly fixed costs are 5622.000 and the variable costs for the potting soil, container, label, seeding, and labor for each galon-sized plant total $1.30. Garden House's volume is currently 480,000 units. Competitors offer the same quality plans to garden centers for $4.00 each Garden centers then mark them up to sell to the public for $9 to $12. depending on the type of plant Read the requirements Requirement Garden House owners want to earn a 145 return on the company's assets. What is Garden House's target full cont? Calculate the target ut cost for Garden House Select the formula labels and anter the amounts. Torgolul com Choose from any or enter any number in the input fields and then click Check Aw 2 Car A Check A 6 ant nursery where it propagates plants for garden centers throughout the region. Garden House has $4.9 million in as container, label, seedling, and labor for each gallon-sized plant total $1.30. Garden House's volume is currently 480, each Garden centers then mark them up to sell to the public for $9 to $12, depending on the type of plant. want to earn a 14% return on the company's assets. What is Garden House's target full cost? House. Select the formula labels and enter the amounts. X * Requirements 1. Garden House owners want to earn a 14% return on the company's assets. What is Garden House's target full cost? 2. Given Garden House's current costs, will its owners be able to achieve their target profit? Show your analysis. 3. Assume that Garden House has identified ways to cut its variable costs to $1.15 per unit. What is its new target fixed cost? Will this decrease in variable costs allow the company to achieve its target profit? Show your analysis 4. Garden House started an aggressive advertising campaign strategy to differentiate its plants from those grown by other nurseries, Garden House doesn't expect volume to be affected, but it hopes to gain more control over pricing. If Garden House has to spend $110,400 this year to advertise and its variable costs continue to be $1.15 per unit, what will its cost-plus price be? Do you think Garden House will be able to sell its plants to garden centers at the cost-plus price? Why or why not? aber ir Print Done
