Profit & Loss-1

Profit & Loss-1 - 52,500 52,500 52,500 52,500 52,500...

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Strategic Management 9/9/09 I chose to use $325 as my price because this keeps unmet demand and unsold industry at 0. This price of $325 keeps your net income at $39,618 through all the years the simulation is run. Your retained earnings continue to grow at a rate of $39,618 per year until it reaches $390,875 at the end of 2015. Keeping the price at $325 maximizes your profit each year because you are just making enough that the demand requires without making more units, which would raise your COGS. I kept the units made at 350 because this maximizes the number of units purchased at the price of $325. The price of $325 and the amount produced at 350 together maximizes the profit of the company throughout the years. 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Sales 10,000 113,750 113,750 113,750 113,750 113,750 113,750 113,750 113,750 113,750 113,750 COGS 15,000 52,500
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Unformatted text preview: 52,500 52,500 52,500 52,500 52,500 52,500 52,500 52,500 52,500 Gross Margin-5,000 61,250 61,250 61,250 61,250 61,250 61,250 61,250 61,250 61,250 61,250 SGA 200 200 200 200 200 200 200 200 200 200 200 EBIT-5,200 61,050 61,050 61,050 61,050 61,050 61,050 61,050 61,050 61,050 61,050 Interest Expense 100 100 100 100 100 100 100 100 100 100 100 PBT-5,300 60,950 60,950 60,950 60,950 60,950 60,950 60,950 60,950 60,950 60,950 Tax 21,332 21,332 21,332 21,332 21,332 21,332 21,332 21,332 21,332 21,332 Net Income-5,300 39,618 39,618 39,618 39,618 39,618 39,618 39,618 39,618 39,618 39,618 Retained Earnings-5,300 34,318 73,935 113,552 153,170 192,788 232,405 272,022 311,640 351,258 390,875 Price 100 325 325 325 325 325 325 325 325 325 325 Quantity 100 350 350 350 350 350 350 350 350 350 350 Unmet demand 700 Unsold Inventory...
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This note was uploaded on 09/08/2010 for the course BUS 189 at San Jose State.

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Profit & Loss-1 - 52,500 52,500 52,500 52,500 52,500...

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