Net profit margin, Operation Management

Assignment Help:

Net profit margin:

1. Transportation firm now spends 60 percent of the sales revenue it receives in the supply chain, and has a net profit margin of 6 percent. The company can invest $100,000 in one of two ventures to increase its profits.

a. How many dollars of additional sales would be required to equal $1 saved through the supply chain?

Answer: $4.35

b. One venture is advertising-based, and is expected to increase revenues (sales) by $600,000 (after spending the $100,000). How much will this increase profits?

Answer:

c. The other venture applies the money in supply-chain efficiencies that are expected to save $200,000 (again, after spending the $100,000). How much will this increase profits?

Answer:

d. Which of these two ventures should the company choose?

Answer:

e. If it expects business to improve next year such that it would only spend 30% of its sales revenue in the supply chain (profit margin remains at 6%) should it change its decision in Part d)?


Related Discussions:- Net profit margin

Explain don''t all firms use similar approaches, Given the success enjoyed ...

Given the success enjoyed by Southwest, Whole Foods, and Google, why don't all firms use similar approaches to managing their employees?

Explain what ethical considerations your response, Please explain in detail...

Please explain in detail what you would do for the following scenario: A good friend of yours from college who had a wild reputation is applying at your company. The HR manager cat

Explain work is a combination of precision machining, Layout Homework Probl...

Layout Homework Problems 6. Avalanche, Inc. is a manufacturer of premium snow skis. The work is a combination of precision machining and skilled craftsmanship. Before completion, s

Why is environmental analysis is vital for an organization, Q1. Why is envi...

Q1. Why is environmental analysis important for an organization? Q2. Write a double-spaced essay of between 750-1000 words on the value of business process improvement to an ind

LPP, A PAPER MILL PRODUCES TWO GRADES OF PAPER VIZ., X AND Y. BECAUSE OF RA...

A PAPER MILL PRODUCES TWO GRADES OF PAPER VIZ., X AND Y. BECAUSE OF RAW MATERIAL RESTRICTIONS, IT CANNOT PRODUCE MORE THAN 400 TONS OF GRADE X PAPER AND 300 TONS OF GRADE Y PAPER I

Explain strategic alignment, Strategic Alignment Please respond to the foll...

Strategic Alignment Please respond to the following- Considering your current job (or one you hope to have in the future), discuss the best way to link your job performance to t

Explain what were mcdonalds inventory turns, McDonalds Inventory $128.40Rev...

McDonalds Inventory $128.40Revenue $17, 140.50COGS $ 11943, 70Gross Profit $5,196.80 Wendy's Inventory: $54.40Revenue: 3148.90COGS: 1634.60Gross Profit: 1514.40 A. What were

Describe what is the productivity, A local market research firm has just wo...

A local market research firm has just won a contract for several thousand small projects involving data gathering and statistical analysis. In the past, the firm has assigned each

What is communication in an organisation structure, What is Communication i...

What is Communication in an organisation structure. Communication: An organisation structure gives channels for the flow of information on that the decisions of the organisat

Explain term everybody''s doing it, How common do you think it is for peopl...

How common do you think it is for people to try to justify their conduct by the argument that "Everybody's doing it"? Give examples from your own experience.

Write Your Message!

Captcha
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!

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