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Anastasy [175]
3 years ago
15

2. Cost-plus, target pricing, working backward A-Plus Shed, Inc., manufactures and sells a do-it-yourself storage shed kit. In 2

012, it reported the following: Units produced and sold 4,000 Investment $ 2,300,000 Markup percentage on full cost 5 % Rate of return on investment 20 % Variable cost per unit $ 500 1. What was A−Plus Shed's operating income in 2012? What was the full cost per unit? What was the selling price? What was the percentage markup on variable cost? 2. A−Plus Shed is considering increasing the annual spending on advertising by $110,000. The managers believe that the investment will translate into a 15% increase in unit sales. Should the company make the investment? Show your calculations. 3. Refer back to the original data. In 2013, A−Plus Shed believes that it will only be able to sell 3,500 units at the price calculated in requirement 1. Management has identified $100,000 in fixed cost that can be eliminated. If A−Plus Shed wants to maintain an 5% markup on full cost, what is the target variable cost per unit?

Business
1 answer:
e-lub [12.9K]3 years ago
7 0

Answer:

1. A-Plus shed's operating income in 2012  = $460,000

1i Full cost per unit = $2,300

1ii Selling price = $2,415

1iii Mark up percentage on variable cost = $23%

2. Yes, the company should make the investment. This is because by expending $110,000 on advertising, it will increase the operating income by $1,039,000 .

3. Target variable cost per unit = $2,028.57

Explanation:

Please find attached detailed explanations of the above answers.

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Define the income elasticity of demand
Irina18 [472]

Answer:

Income elasticity of demand is an economic measure of how responsive the quantity demand for a good or service is to a change in income. The formula for calculating income elasticity of demand is the percent change in quantity demanded divided by the percent change in income.

3 0
2 years ago
Carol (25 years old) studied music education in college and graduated a year ago. She currently works as a music teacher at a ye
mrs_skeptik [129]

Answer:

Carol should save $672 per month.

Explanation:

Savings is the process of setting aside some part of one's income for the sake of an emergency or for retirement purposes. The best way to budget one's income by economists is: to save at least 20 %, a maximum of 50% should be spent on necessities and the remaining 30% should go towards discretionary items. In our case Carol can budget her income as follows;

<em>Step 1: Determine annual savings</em>

S=20%×N.I

where;

where;

S=savings

N.I=net income

In our case;

S=unknown

N.I=$40300 a year

replacing;

S=(20/100)×40,300

S=(0.2×40,300)=$8,060

<em>Step 2: Determine monthly savings</em>

Monthly savings=annual savings/number of months in a year

where;

Monthly savings=unknown, to be determined

annual savings=$8,060

number of months in a year=12

replacing;

Monthly savings=(8,060/12)=$672 per month

Carol should save $672 per month.

3 0
4 years ago
When the economy is on the short-run aggregate supply curve and to the left of the long-run aggregate supply curve, actual aggre
nirvana33 [79]

Answer:

Nominal wages will fall, and the short-run aggregate, supply curve, shifts to the right.

Explanation:

When the economy is on the short-run aggregate supply curve and to the left of the long-run aggregate supply curve, actual aggregate output will eventually equal potential output as nominal wages fall(s) and the short-run aggregate supply curve shifts to the right.

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3 years ago
$444,567 Revenue, $400,500 Expenses. Net Profit?
chubhunter [2.5K]

Answer:

44,067

Explanation:

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Food that qualifies as junk may contain a lot of the following EXCEPT
yuradex [85]

Answer:

A. Milk

I hope this helps,if not sorry

5 0
3 years ago
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