Solution-What would be the new operating profit for the

What would be the new operating profit for the company

Reference no: EM132870844

Question - Big Bucks Casino is currently operating at 80 percent capacity. Worried about the casino's performance, Grey, the general manager, reviewed the company's operating performance. Following are revenue and cost data relating to Big Bucks Casino, in millions of dollars:

	Segment
	Card Tables	Slots	Craps	Roulette
Sales	Rs.1,250	Rs.2,500	Rs.750	Rs.1,750
Less variable costs	600	1,000	450	750
Contribution margin	Rs.650	Rs.1,500	Rs.300	Rs.1,000
Less fixed costs	400	750	400	500
Operating profit (loss)	Rs.250	Rs.750	Rs.(100)	Rs.500

Required -

A. What is the current operating profit for the company as a whole?

B. Assume that all fixed costs are unavoidable. If Grey eliminated the unprofitable segments, what would be the new operating profit for the company as a whole?

C. What options does management have to maximize profits?

D. What qualitative factors do you think management should consider before making this decision? What impact could these qualitative factors have on the decision?

Reference no: EM132870844

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What would be the new operating profit for the company

Reference no: EM132870844

Reference no: EM132870844

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