Answered step by step
Verified Expert Solution
Question
1 Approved Answer
This is a marketing question that relates to accounting. Assume you are the marketing manager for Marion Manufacturing. The manufacturer has 3 product lines: A,
This is a marketing question that relates to accounting.
Assume you are the marketing manager for Marion Manufacturing. The manufacturer has 3 product lines: A, B, and C. The accountant has provided you with the following information and would like to meet with you to discuss. For the past two years Product Line C has consistently had a negative margin. The amounts are given in thousands. Note: Depreciation on the equipment is traceable (allocated/dedicated) to the specific product line. The product line equipment cannot be sold. Hint: depreciation will not change regardless of the decision. It is a sunk cost and not relevant to the decision.) Respond to the following What ifs. Using the information provided: What is the impact upon the company's net operating income if Product Line C is dropped and the supervisor is terminated? - What if: The data analytics from your customer analysis indicates that 20% of your Product Line A customers choose to buy from you because you offer a full range of products, A, B and C. In other words, 20% of your customers buy all 3 product lines. You are concerned that if Product Line C is dropped these customers will go to the competitor. What is the potential impact upon the company's net operating intcome if Product Line C is dropped? Theory question: From the marketer's perspective discuss factors that should be considered in a decision to drop a product line. Using the information provided: - What if: Each product line has a different supervisor. Product Line C supervisor has been with the company for 15 years and you do not want to terminate the person. What is the impact upon the company's net operating income if Product Line C is dropped? There would be an increase of 15,000 in net operating income - What if: The CEO is pressuring you to increase the net operating income; is concerned about the continual negative impact of Product Line C; and does not care about the supervisor. What is the impact upon the company's net operating income if Product Line C is dropped and the supervisor is terminated? - What if: The data analytics from your customer analysis indicates that 20% of your Product Line A customers choose to buy from you because you offer a full range c products, A, B and C. In other words, 20% of your customers buy all 3 product lines:You are concerned that if Product Line C is dropped these customers will go to the competitor Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started