Week 5 OAES Template - work

Week 5 OAES Template - work - Wilson is a wholesale...

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Per Case Item B Item C Average selling price per case $9.60 $3,744,000 $11.04 $4,305,600 $9.60 $3,744,000 Average variable costs: Widget production per case $4.80 $1,872,000 $5.52 $2,152,800 Selling expense per case $0.96 $374,400 $1.10 $430,560 Total Variable Costs $5.76 $2,246,400 $6.62 $2,583,360 $6.62 $2,581,800 Contribution Margin $3.84 $1,497,600 $4.42 $1,722,240 $2.98 $1,162,200 40% 40% 31% Expected annual sales volume in cases 390,000 390,000 390,000 Annual fixed costs $_________ $1,056,000 $1,056,000 $1,056,000 $1,056,000 $1,056,000 $1,056,000 Profit before tax $441,600 $666,240 $106,200 Tax rate 40% $176,640 40% $266,496 40% $42,480 Net Profit $264,960 $399,744 $63,720 BE is the point at which total costs = total revenue. 275,000 F / (Pu - Bu) Formula on page 144 (notation on pg 143) fixed / (price per unit - vc per unit) You can also take fixed costs/contrib margin per unit 40% Current Contribution Margin Step 1. Determine current Contrib Margin % $6.62 New Variable Cost with 15% increase
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Week 5 OAES Template - work - Wilson is a wholesale...

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