Can this be solved please?

Individual Assignment 1 - CVP - SHOW WORK for all numerical answers. Single product CVP with scenario analysis 1. Gibson's Gym is a fitness and aerobic center located in Austin; TX. With over 25,000 square feet of space, Gibson's offers its customers an unparalleled fitness experience, including the finest equipment for cardiovascular training, resistance training, and free-weight training. Gibson's also features state-of-the- art aerobics, spinning, yoga, and tai chi classes taught by nationally certified instructors. And, when not working out, patrons can enjoy other amenities such as Gibson's tanning salon, hot tub, sauna, and juice bar. The owners of Gibson's Gym currently are working on their operating plan for the coming year, and they have provided you with the following average membership and cost data for the previous year: Annual membership fee $500 per member Number of members 5,000 Variable cost (supplies, instructors, etc.) $200 per member Fixed costs (equipment, salaries, etc.) $1,200,000 The owners anticipate that, for the coming year, both total fixed costs and the variable cost per member will remain unchanged from the previous year. a) Assuming the same number of members as last year, what is Gibson's expected before tax profit for the coming year? b ) What is the unit-contribution margin per member? How many members must Gibson's Gym have to break even? c) Assuming a tax rate of 30%, how many more members will Gibson's need to attract this year to reach an after-tax profit of $315,000? d) The owners of Gibson's Gym are considering reducing the annual membership fee by 10%. They believe this will increase membership to 6,500 members for the coming year. What will before tax profit be if the owners adopt this strategy (note: the membership fee for all members will be reduced by 10%)? Does this seem like a good option? Why? Support your answer with calculations. e) As an alternative to reducing the membership fee by 10%, the owners of Gibson's Gym could increase membership to 6,500 members by adopting a special advertising campaign. What is the maximum amount that the owners should pay for the advertising campaign? Why? (Hint: the amount you calculate will make the owners indifferent between lowering the annual membership fee by 10% and adopting the advertising campaign).Individual Assignment 1 CVP *7- SHOW WORK for all numerical answers. ' Multiple product CVP - " 1... my 2. AMG Enterprises is considering expanding Sales by producing three different versions of their product. Each will be targeted by the marketing department to different Income levels and hence will be produced from three different 'qualities of materials. After reviewing the sales forecasts the sales department feels that for every item of A sold, 4 of M can be sold and 8 of G can be sold. The following information has been assembled by the sales department and the production department.- - A - M ' 9'; Sales price (per unit) '_ " $15.00 $10.00 $5.00 _ Material Cost 5.00 ' 4.00 2.00 Direct Labor ' 2. 00 1.50 1.25 Variable Overhead ' 2. 00 1.50 1.25 The xed costs associated with the manufacture of these three products are $75,000 per year. Required: Determine the number of units of each product that would be sold at the breakeven point. Prove that your answer will lead to breakeven We: 3. The Cottage Bakery sells a variety of gnurniet breads, cakes, pies, and pastries. Although its wares are considerably more expensive than those available at supermarkets and other bakeries, the Cottage Bakery has a lo 31 clientele willing to pay a premium price for premium quality. In atypical month, the Cottage Bakery enerates revenue of $150,000 and earns a prot of $7, 500. The Cottage Bakery 3 contribution margin ratio is 40% a) What' 13 the Cottage \"Bakery 3 margin of safety at its current sales level? 13) What' Is the Cottage Bakery' s current degree of operating leverage? ' c) Now assume that Cottage Bakery expects a 15% increase in revenues. Using the information above, how much should Cottage Bakery expect their prots to increase? Constrained Resources 4. Skiing Accessories has 3,000 machine hours of-plaht capacity available for manufacturing sun goggles. Following is information about these products. ' . Premium Regular Selling price per unit $50 $30 Variable cost per unit $3 5- $10 Units that can be manufactured per machine hour on the same production line 8 _ 5 Estimated demand 12,000 goggles 21,000 goggles _ a) How many machine hours should be devoted to the manufacture of each product? In) What is the maximum amount that Skiing Accessories would be willing to spend, both per hour and in total, to increase capacity? 5