What was stephen jones ltds operating profit in 2022

Reference no: EM133474929

Question: Stephen Jones Ltd manufactures and sells table sets. In 2022, it reported the following:
4,000 Units produced and sold
$4,000,000 Investment
10 per cent Mark-up percentage on a full cost
20 per cent Rate of return on investment
$800 Variable cost per unit

Required:

A. What was Stephen Jones Ltd's operating profit in 2022?

B. What was the full cost per unit? What was the selling price?

C. What was the percentage mark-up on variable cost to achieve the selling price?

D What are the total fixed costs?

E. Stephen Jones Ltd is considering increasing the annual spending on advertising by $250,000. The managers believe the investment will translate into a 10% increase in unit sales. Should the company invest? Show your calculations.

F. Refer back to the original data. In 2022, Stephen Jones Ltd believed it could sell only 2,800 units at a price calculated in requirement (a) Management has identified $200,000 fixed cost that is possible to eliminate. If Stephen Jones Ltd wants to maintain a 10% mark-up on full cost, what is the target variable cost per unit?

Reference no: EM133474929

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