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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## This note was uploaded on 11/13/2010 for the course IT 6410 taught by Professor Bebble during the Spring '10 term at Walden University.

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

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