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would really appreciate help The Vice President for Sales and Marketing at Waterways Corporation is planning for production needs to meet sales demand in the
would really appreciate help
The Vice President for Sales and Marketing at Waterways Corporation is planning for production needs to meet sales demand in the coming year. He is also trying to determine how the compamys profits might be increased in the coming year, This problem asks you to use cost-volume-profit concepts to help Waterways understand contribution margins of sorne of its products and decide Whether to mass-produce any of them. Waterwass markets a simple water control and timer that it mass-produces. Last year, the compary sold 751,000 units at an average selling price of $4.90 per anit. The variable costs were $2,575,930, and the fxed costs were 5772.779 . Waterways is thinking of massrproducing one of its special-order sprinklers. To do so would increase variable costs for all sprinklers by an average of $0.70 per unit. The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average sales price would increase $0.20 per unit. Waterways currently sells 497,000 sprinkler units at an average selling price of $25,60. The manufacturing costs are $6,925,390 variable and $1,733,086 fixed. Selling and administrative costs are $2,617,010 variable and $783,290 fixed If Waterways begins mass-producing its special-order sprinklers, how would this affect the company? (Round ratio to 0 decimal places, e.g. 5% and Net income to 0 decimal places, e.g. 2,520.) Waterways is thinking of mass-producing one of its special-order sprinklers. To do so would increase variable costs for all sprinklers by an average of $0.70 per unit. The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average sales price would increase $0.20 per unit. Waterways currently sells 497,000 sprinkler units at an average selling price of $25,60. The manufacturing costs are $6,925,390 variable and $1,733,086 fixed, Selling and administrative costs are $2,617,010 variable and $783,290 fixed. If Watenways begins mass-producing its specia-order sprinklers, how would this affect the company? (Round ratio to O decimal places, e.g. 5% and Net income to 0 decimal places, e.s. 2.520.) Step by Step Solution
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