Question: ? Can you please answer 3-33 If changes are made to the selling price or cost structure, determine the number of units that (text not
?
Can you please answer 3-33
If changes are made to the selling price or cost structure, determine the number of units that (text not clear) must sell (a) to break even and (b) to achieve its net income objective. Determine which alternative Skudder should select to achieve its net income objective. Show you calculations. Choosing between compensation plans, operating leverage. (CMA, adapted) Diem Corporation manufactures fertilizer products that are sold through a network of external sales agents. The agents are paid a commission of 20% of revenues. Diem is considering replacing the sales agents with its own salespeople, who would be paid a commission of 15% of revenues and total salaries of $1.750.000. The income statement for the year ending December 31.2012, under the two scenarios is shown here. Calculate Diem's 2012 contribution margin percentage, breakeven revenues, and degree of operating leverage under the two scenarios. Describe the advantages and disadvantages of each type of sales alternative. In 2013. Diem uses its own salespeople, who demand an 18% commission. If all other cost behavior patterns are unchanged, how much revenue must the salespeople generate in order to earn the same operating income as in 2012 JumpUP Inc produces two types of trampolines. One is smaller and is primarily used in gyms for exercise classes. The other is a larger model designed for recreational use. The smaller trampoline sells for $200 and has variable costs of $120. The larger trampoline sells for $600 and has variable costs of $420 JumpUP sells four smaller models for every one larger model sold. Fixed costs equal $1.250.000. What is the breakeven point in unit sales and dollars for each type of trampoline at the current sales mix
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
