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Activities LibreOffice Calc 13.3 C Jun 3 13:23124 Summer 2019 Module 5 Excel Workbook Assianment.xlsx- LibreOffice Calc File Fdit View Insert Farmat Styles Sheet Data Tacls Wincow Help A A = % 74 00 00 BIU Calibri 11 fx - B16 KL A G HI M 5 6 Brick Inc makes BRICKS. Their pre-tax income and their margin of safety have both been low A paredto he levels tne compaly woul ke aieve, osequery ey dskedthel 7 ses of 8 both pre-tax income and their margin of safety over the next year. The current pricing structure 9 consists of the following data points: Requirement 1: Current Year Scenario 2 Scenario 1 Scenario 3 Selling price $33.50 10 for $33.50 Selling 41,000 ei te ner unit: Unit yolume 41.000 12 Varlable costs per unit: Direct labor $5.50 13 Material $5.50 $9.00 Direct labor 14 $9.00 Overhead $0.50 Material 15 $0.50 Packaging S0.95 Overhead 16 $0.95 17 Packaging Fixed costs: Fixed costs: $ 275.000 $275,000 rine ... rine Selling and administrative Selling and administrativ $ 350,000 $350,000 20 21 Break Even Analysis: 22 Units 23 margin of safety for next vear, Respond to Required Items # 1, 2, & 3 for the Current Year and 24 for each 25 for each In Sales Dallars the Three Scenarios suggested by the employee teams. Answer Required Item #4 f the Three Scenarios and then make the decision requested in Required Item #5. Requirement 2: 27 Required: 28 1. Compute the Break-Even point in both units and sales dollars for the Current Data and each of the Three Scenarios. 29 30 2. Provide a Contribution Margin Income Statement in proper form for the Current Data and each of the Three Scenarios. 31 32 3. Provide the Margin of Safety calculation for the Current Data and each of the Three Scenarios 33 44. Briefly, list two pros and two cons that you consider important when comparing the results of Implementing each of the Three Scenaros Requirement 3: 35 Problem A Problem B. Probiem C.Problem u. |PaqeStyle Probiam Engliah USA T- | 340% Ausrage Sum. 0 Activities LibreOffice Calc 13.3 C Jun 3 13:23145 Summer 2019 Module 5 Excel Workbook Assianment.xlsx- LibreOffice Calc File Fdit View Insert Farmat Styles Sheet Data Tacls Wincow Help abs AL 2: A A = 7 % 74 00 00 BIU Calibri 11 f B16 K L G F M 36 5. Cho e the nario that you would recommend to the company and briefly explain why it is the best choice. A 37 38 13.14 % 39 Current Data--Check Figure: Margin of Safety 40 Requirement 4: for Scenario 1-Check Figure: CM % = 59.70 % Scenario 1 41 42Research indicates that the company can purchase a different material, of equal quality, to Pros: construct the blocks. This Would reduce material costs by 15%. esult in a 20% reduction in direct labor costs 44 All other data points remain constant 45 Cons: 46 47 Scenario 2-Check Figure: 48Research Indicates that the company can purchase a different materlal, of equal quallty, to construct the blocks. This would reduce material costs 50 Using the new material would also result in a 20 % reduction in direct labor costs. E in Units 26,767 15 % Scenario 2: 49 Pros: 1Market research indicates that the company could increase the selling price by 10%, but that units sold. doing so would result in a 10 % decrease 52 All other data points remain constant. Cons: 55 Scenario 3-Check Figure: Pre-tax Income $272,439 Negotiations with suppliers resulted In an agreement that would decrease the cost of the same new material mentioned in Scenarios 1 and 2 by 20 % if the company purchased it in bulk. 56 Scenario 3: 57 Pros: To use up the material purchased i the amounts required would need to increase sales unit volume by 50 %. Market research indicates that this is the selling price is decreased by 20 % . get the discount, the company 59 possible as long 60 Cons: Market research also indicates that improved packaging would be needed to achiieve the Direct labor costs would remain the same as they were in Scenarios 1 and 2 63 64 Probiem C Problem U + Froblem A Problem D |PaqeStyle Probiam 14030 English USA Ausrag:Sum