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There is three parts here is the first! Cindy Alexander, Sarasota, Inc's vice president of marketing, has received a sales call from a vendor of
There is three parts here is the first! Cindy Alexander, Sarasota, Inc's vice president of marketing, has received a sales call from a vendor of customer relationship management (CRM) software. The vendor claims that the software and other data her company provides will enable Sarasota to target its advertising more appropriately and to identify new markets. The average improvement in sales volume from CRM is 10% with no increase in advertising costs. The cost of the software and related services is $1,853, 325. Sarasota depreciates software over five years. The company's current cash-basis income statement, based on sales of 82,900 units, follows. Sales revenue $7.930,000 Cost of goods sold (all variable) 3,200,000 Gross margin 4,730,000 Less operating costs Splling expense (50% variable) $1,223,000 Administrative expense (all fixed) 3,045,000 4.268.000 Income $462,000 (a) Calculate the payback period for the software if Sarasota, Inc realizes the reported average Improvements (Round answer to 2 decimal places, e.g. 15.25.) Payback period years
There is three parts here is the first!
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