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GrogVix [38]
3 years ago
6

Digby's product manager is considering lowering the price of the Daft product by $2.50 and wants to know what the impact will be

on the product’s contribution margin. Assuming no inventory carry costs, what will Daft's contribution margin be if the price is lowered?
Business
1 answer:
Dvinal [7]3 years ago
4 0

Answer:

D.  34.00%

Explanation:

The computation of the new contribution margin is shown below:

As we know that

Contribution Margin = Net Sales Revenue - Variable Expenses

where,

Net sales revenue is

= 604 units × $32.5

= $19,630

The variable expense = Total material cost + total labor cost

Total Material Cost = 604 units × $14.36 = $8,673.44

Total Labor Cost = 604 units × $7.09 = $4,282.36

So, the variable expense is

= $8,673.44 + $4,282.36

= $12,955.8

Now

Contribution margin = $19,630 - $12,955.8 = $6,674.2

And,

Contribution margin ratio = Contribution margin ÷ net sales

So,  Contribution margin = $6,674.2 ÷ $19,630

= 34.00%

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You are the purchasing manager and you buy a raw material having the following information: Annual demand = 900 units Fixed orde
alex41 [277]

Answer:

=2983.25

Explanation:

In calculating the inventory on raw materials you will have to Add together the original value of raw materials, the works in progress if any and finished goods to get starting total inventory.

The solution to the question can be calculated like this:

EOQ=\sqrt{2* 900 * 100/2.5}

EOQ=268.328

EOQ+SAFETY STOCK=268.328+30

=298.325

VALUE=298.325*10

=2983.25

7 0
3 years ago
Pepsi uses advertising to create the impression that Pepsi is superior to any other soft drink. Pepsi is attempting to:_________
ratelena [41]

Answer:

The correct answer is the option B: Differentiate Pepsi from other types of soft drinks.

Explanation:

To begin with, the fact that the company is using the advertising as its major weapon when it comes to atract consumers and increase the number of sales then they are trying so desperetely to differentiate its brand from the other ones of the competitors and they do it by showing in their advertisements that they are superior to any other. And that strategy, the one of using the marketing campaing as a primary source of getting to the consumers, is in order to achieve a more high look from the point view of the consumers so they put their brand in a higher level regarding the competitors' brands.

8 0
3 years ago
Direct labor and indirect labor are recorded, respectively, to: Multiple Choice Work in Process Inventory and Factory Overhead.
Nana76 [90]

Direct labor and indirect labor are recorded in work in Process Inventory and Factory Overhead. Option A is correct.

<h3>What is indirect labor?</h3>

Indirect labor are expenses incurred during manufacturing process which are not directly, some logistics cost can be here.

Direct labor are charged directly in production such as cost of resources. They are recorded in the company overall spending called overhead cost.

Therefore, Direct labor and indirect labor are recorded in work in Process Inventory and Factory Overhead. Option A is correct.

Learn more on labour below

brainly.com/question/453055

#SPJ1

7 0
2 years ago
Tina owns a workshop that specializes in making intricate wooden decorative items. She makes scale models of most of the existin
Soloha48 [4]

Answer:

Having increased profit

Explanation:

When there exists competition in a market, owners and companies are forced to lower their prices to make their product or service competitive. The opportunity that Tina has now, enables her to sell the wooden decorative items at a prize that not only cover her costs of production, but also with higher profit. However, Tina must be very wise as to how to use that profit. She may not have competitors now, but in the future she might have. Granted, she can look at ways in which she can use that profit to invest in technology or computer systems that could make the production costs lower, which in turn enable her to reduce the prize of her products in the future.

5 0
3 years ago
Dinklage Corp. has 7 million shares of common stock outstanding. The current share price is $67, and the book value per share is
Drupady [299]

Answer:

The company's capital structure weights on a book value basis are:

a. 28.57% for equity, and

b. 71.43% for debt.

Explanation:

Book value of equity = 7,000,000 * $6 = $42,000,000

Book value of debts = $60,000,000 + $45,000,000  = $105,000,000

Dinklage Corp.'s total value = $42,000,000 + $105,000,000  = $147,000,000

Book value weights of equity = $42,000,000 / $147,000,000 = 0.2857, or 28.57%

Book value weights of debt = = 1 - 0.2857 = 0.7143, or 71.43%

Therefore, the company's capital structure weights on a book value basis are 28.57% for equity and 71.43% for debt.

5 0
3 years ago
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