Question

The management accountant at Lang Manufacturing Co. collected the following data in preparation for a life-cycle analysis on one of its products, a leaf blower: Item This Year Change Over Last Year Average Annual Change Over the Last Four Years Annual sales $2,700,000 1.8% 23.5% Unit sales price 450 2.4% 8.3% Unit profit 100 -1.0% 3.0% Total profit 600,000 -1.2% 30.0% The stage of the sales life cycle the product is in is: Withdrawal. Introduction. Decline. Maturity. Growth.

Answer 1

Answer: Decline stage

Explanation:

The stage of the sales life cycle the product is in the Decline stage of the product cycle. We can see that the average performance of the product over its past life is higher than that of its last year's performance.

Under the decline stage, there will be a reduction in the quantity of goods that's sold thereby leading to a reduction in profits until it gets to a point that producing the goods will not be profitable anymore.