EasyFind, Inc. sells StraightShot golf balls for $22 per dozen, with a variable manufacturing cost of...

 

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EasyFind, Inc. sells StraightShot golf balls for $22 per dozen, with a variable manufacturing cost of $11 per dozen. EasyFind is planning to introduce a lower priced ball, Duffer's Delite, that will sell for $13 per dozen with a variable manufacturing cost of $5 per dozen. The firm currently sells 47,900 StraightShot units per year and expects to sell 20,600 units of the new Duffer's Delight golf ball if it is introduced (1 unit = 12 golf balls packaged together). Management projects the fixed costs for launching Duffer's Delight golf balls to be $9,720. Another way to consider the financial impact of a product launch that may steal sales from an existing product is to include the loss due to cannibalization as a variable cost. That is, if a customer purchases Duffer's Delite ball instead of Straight Shot, the company loses the margin of Straight Shot that would have been purchased. Using the previously calculated cannibalization rate, calculate Duffer's Delite per unit contribution margin including cannibalization as a variable cost. TUTORIAL 0.00 dollars and cents PRACTICE PRACTICE f RACTICE EasyFind, Inc. sells StraightShot golf balls for $22 per dozen, with a variable manufacturing cost of $11 per dozen. EasyFind is planning to introduce a lower priced ball, Duffer's Delite, that will sell for $13 per dozen with a variable manufacturing cost of $5 per dozen. The firm currently sells 47,900 StraightShot units per year and expects to sell 20,600 units of the new Duffer's Delight golf ball if it is introduced (1 unit = 12 golf balls packaged together). Management projects the fixed costs for launching Duffer's Delight golf balls to be $9,720. Another way to consider the financial impact of a product launch that may steal sales from an existing product is to include the loss due to cannibalization as a variable cost. That is, if a customer purchases Duffer's Delite ball instead of Straight Shot, the company loses the margin of Straight Shot that would have been purchased. Using the previously calculated cannibalization rate, calculate Duffer's Delite per unit contribution margin including cannibalization as a variable cost. TUTORIAL 0.00 dollars and cents PRACTICE PRACTICE f RACTICE

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Given I unit 12 golf balls together one unit one dozen Case Straight shot golf balls Total number of ... View the full answer