User Account

All Pages

Why company financial picture changed with new sales mix

Assignment Help Managerial Accounting
Reference no: EM132605195

Assume that through aggressive marketing The Best Team is able to shift its sales mix toward more sales of jackets. Total sales remain $4 million per month, but now 40 percent of this revenue stems from sales of jackets, shoes 40 percent, watches 10 percent and 10 percent for shorts. Fixed cost is still $800,000 per month. Using the new sales mix compute:

Question 1. Average contribution margin ratio of total monthly sales.

Question 2. Monthly operating income.

Question 3. The monthly break-even sales volume (stated in dollars).

Question 4. Explain clearly why the company's financial picture changed with the new sales mix.

Question 5. If the costs for all the products would decrease with 10 percent would the operating income then increase with 10 percent. Explain

Question 6. Suppose that due to increased competition The Best Team needs to decrease the prices of Watches and Jackets with 30 percent. The same time the fixed cost increased to $1,200,000 otherwise everything else remains the same. Calculate the new break-even point and operating income.

Question 7. Comment on the new results (from question 16) compared to the base case in Part 1. Has the risk profile of the company changed?

Reference no: EM132605195

Questions Cloud

Why might a lender want such an assignment : The ownership of the stock certificates, Why might a lender want such an assignment? What advantage of the corporate form of organization comes into play here
Discuss the base pay and variable pay : In the video, base pay and variable pay are discussed. What are the main differences between each? How would you used variable pay to drive organizational.
Should SM accept the outside offer : On the basis of financial considerations alone, should SM accept the outside offer assuming that production remains consistent with the past year
Compute the percentage rate of net funds freed : National Auto Loan has customers throughout the 48 contiguous states. Compute the percentage rate of net funds freed
Why company financial picture changed with new sales mix : If the costs for all the products would decrease with 10 percent would the operating income then increase with 10 percent. Explain
Record transactions assuming Coronado uses the equity method : Record the above transactions assuming Coronado uses the equity method to report its investment in Sugar Maple Candy Company
Summarize ethics in financial responsibilities : Summarize ethics in financial responsibilities and to evaluate ethical considerations of executive compensation by writing a persuasive essay.
What would the company ending merchandise inventory cost : What would the company's ending merchandise inventory cost be on December 31, 2018 if the perpetual inventory system and last-in, first-out inventory costing
What is net dollar advantage of accepting outside supplier : What is the net dollar advantage or disadvantage of accepting the outside supplier's offer? (Do not round intermediate calculations)

Reviews

Write a Review

Managerial Accounting Questions & Answers

  What is the expected market price share

$46.25 at the end of every month per preferred share. What is the expected market price share if money is worth 7.1% compounded quarterly?

  What are patterns of global trade

What are patterns of global trade and the considered transportation expenses.

  Provide an example of a cost

Please provide an example of a cost that is fixed in the short run but becomes variable over a longer period of time.

  Should patrick sell radios for per unit or correct defects

atrick Corporation inadvertently produced 10,000,Should Patrick sell the radios for $3 per unit or correct the defects and sell the radios at the regular price?

  Provide cash budget for january and february and march

Provide cash budget for January and February and March. The opening cash balance on 1st Jan was expected to be £30,000. The sales budgeted were

  What budgeted purchases of product a for the year would be

What Budgeted purchases of Product A for the year would be? The sales budget for Modesto Corp. shows that 20,000 units of Product A and 22,000 units

  Find how are prepared based on several levels of activity

Find how are prepared based on several levels of activity. That is, adjustments are made according to the changes in the operation when preparing

  Calculate standard quantity of direct labor for one quilt

Calculate the standard quantity of direct labor for one quilt. Caro-Lind Inc. manufactures personalized baby quilts. An experienced embroiderer can personalize

  Provide journal entry for changes to capital during year

Provide journal entry for Changes to capital during year. Provide the ending balance for each partner. Distribution of net income to all partners

  What is the return on common stockholder equity

What is the Return on Common Stockholder equity if Sales are $150,000, Net Income is $40,000, Dividends paid to preferred stockholders is $5,000

  Predict the following items for mateo company

Mateo Company's average cost per unit is $1.425 at the 16,000-unit level of activity and $1.38 at the 20,000-unit level of activity.Note: you need to calculate a total cost.

  Analyze health care worker drain case explained by millum

Analyze the Health Care Worker Drain case explained by Millum. Must rich governments stop hiring health professionals from poor countries?

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