User Account

All Pages

Calculate the stand-alone selling price of the installation

Assignment Help Financial Management
Reference no: EM132378780

Question

Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff. The installation includes programming the remote to have the TV interface with other parts of the customer's home entertainment system.

VP concludes that the TV, remote, and installation service are separate performance obligations. VP sells the 60-inch TV separately for $1,930 and sells the remote separately for $190, and offers the entire package for $2,260.

VP does not sell the installation service separately. VP is aware that other similar vendors charge $240 for the installation service. VP also estimates that it incurs approximately $190 of compensation and other costs for VP staff to provide the installation service. VP typically charges 40% above cost on similar sales.

Required:

Calculate the stand-alone selling price of the installation service using each of the following approaches.

Stand-alone selling price

Adjusted market assessment

Expected cost plus margin

residual

Reference no: EM132378780

Questions Cloud

Thera bank-loan purchase modeling : Loan Purchase Modeling This case is about a bank (Thera Bank) which has a growing customer base. Majority of these customers are liability customers
Calculate the amount of revenue and gross profit : Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred.
What are some of the possible erp features : What are some of the possible ERP features and functionalities for computer parts supplier business?
Describe how a combination strategy can protect : Describe how a combination strategy can protect a firm from the effects of the five forces and discuss risks associated with combination strategies
Calculate the stand-alone selling price of the installation : Video Planet (VP) sells a big screen TV package consisting of a 60-inch plasma TV, a universal remote, and on-site installation by VP staff.
Principal Component and Factor Analysis Problem Using SAS : Principal Component and Factor Analysis Problem Using SAS - Find the amount and percent of variance accounted for by each unrotated component
Describe in business terms why you believe : Describe in business terms why you believe the Federal Group CEO and Directors decided to diversify ownership with several (unrelated and related) businesses
What is the sustainable growth rate : Assets and costs are proportional to sales. Debt and equity are not. The company maintains a constant 45 percent dividend payout ratio.
Federal group was publicly listed : Federal Group was Publicly Listed - but had a contracted growth - now a private organisation. What are the benefits (and possible negative aspects)

Reviews

Write a Review

Financial Management Questions & Answers

  What is effective rate of interest

What is the effective rate of interest? What would the effective rate be if Carey were required to make 12 equal monthly payments to retire the loan?

  Treasury bonds currently have a nominal yield

Assume that 4-year Treasury Bonds currently have a nominal yield of 6.2%, and a 4-year Corporate Bonds have a nominal yield of 8.5%. If Maturity Risk Premium (MRP) on all 4-year contracts currently is 1.3%, and Corporate Bonds currently have addition..

  If the barry bonds have a maturity then how much are worth

James Bonds have a coupon rate of 8% with semiannual interest payments, a face value of $1,000, and 7 years to go until maturity.

  How do you generally prepare for tax season

How do you generally prepare for tax season? Do you normally owe more taxes when you file, or do you receive a refund?

  Find the variance and standard deviation

Find the variance and standard deviation of X.

  Calculate the percentage in the income statement used

What is the formula. Total income 453000 and 13.10% How do you calculate the percentage in the income statement used 10K

  Compute the monthly payment on this loan

Compute the monthly payment on this loan. If the person pays an additional $500 monthly toward the principal, how many years will it take him to repay the loan?

  Swiss government security rate

The Swiss franc (CHF) is currently trading in the spot market at $0.5800/CHF. The 180-day forward rate is $0.5743/CHF. The U.S. Treasury bill rate for 180 days is 3.1 percent in the United States. What do you expect is the 180-day Swiss government se..

  Three stocks in an index-what is the new divisor

Able, Baker, and Charlie are the only three stocks in an index. The stocks sell for $72, $400, and $98, respectively. If Able undergoes a 3-for-4 reverse stock.

  Company capital structure consists of debt

Financing Hook Industries' capital structure consists solely of debt and common equity. What percentage of the company's capital structure consists of debt?.

  Why do you think the mutual fund industry has experienced

Why do you think the mutual fund industry has experienced a decline in front-end sales loads since the introduction of 12b-1 fees?

  Proposal to manufacture-market fiber-optic device

BioCom, Inc. is weighing a proposal to manufacture and market a fiber-optic device that will continuously monitor blood pressure during cardiovascular surgery and other medical procedures in which precise, real-time measurements are critical. Compute..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd