[The following information applies to the questions displayed below.] Charlevoix Cases makes mobile phone cases. The company has collected the following price and cost characteristics: Sales price Variable costs Fixed costs $ 12.00 per case 5.50 per case 391,950 per year Assume that the company plans to sell 75,300 units annually. Consider requirements (b), (c), and (d) independently of each other. Required: a. What will be the operating profit? b. What is the impact on operating profit if the sales price decreases by 20 percent? Increases by 10 percent? Note: Do not round intermediate calculations. c. What is the impact on operating profit if variable costs per unit decrease by 20 percent? Increase by 10 percent? Note: Do not round intermediate calculations. d. Suppose that fixed costs for the year are 20 percent lower than projected and variable costs per unit are 20 percent higher tha projected. What impact will these cost changes have on operating profit for the year? Will profit…

Pharoah Industries produces and sells electronic sound equipment. The company has production capacity of 20600 units and currently production schedule is for 18600 units. Each unit has a selling price of $25, variable product cost of $15, and variable selling cost of $2. Another division wishes to purchase 560 units. If Pharoah sells the units to the other division, it will avoid $1 of the variable selling costs. What is the minimum transfer price that will maximize corporate profits? $25 $15 $17 $16

Marketing manager suggests the company should sell CHANTEQ in both states as he is confident the market would be good. However, the direct material cost will increase by 10%.   Advise the management on how many units to be sold for both states to maintain its annual profit.

Divine Electronics Ltd. manufactures a line of headphones. Sales are increasing, and management is concerned that the company may not have sufficient capacity to meet the expected demand for the coming  year. The following data are available for planning purposes:   Product Estimated Demand Next Year Selling Price Direct Materials Direct Labour   1 Wire 78,000 $25.00 $7.30 $5.00   2 Wire 75,000 20.00 10.20 3.20   3 Wire 115,000 17.50 2.80 5.00             The following additional information is available: 1. With the strong competition, the company feels that it can't increase its selling prices above those indicated 2. The direct labour rate is $10 per hour; this rate is expected to remain unchanged during the coming year. 3. Fixed manufacturing costs total $640,000 per year.  Variable manufacturing overhead costs are equal to 25% of the direct labour costs. 4. The company's plant has a capacity of 110,000 direct labour-hours per…

After conducting a market research​ study, Magnificent Manufacturing decided to produce a new interior door to complement its exterior door line. It is estimated that the new interior door can be sold at a target price of​ $270. The annual target sales volume for interior doors is​ 29,000. Magnificent has target operating income of​ 40% of sales.   What are target sales​ revenues?   A. ​$4,698,000   B. ​$3,132,000   C. ​$10,962,000   D. ​$7,830,000

(The following information applies to the questions displayed below.] Charlevoix Cases makes mobile phone cases. The company has collected the following price and cost characteristics: Sales price Variable costs Fixed costs $ 12.00 per case 5.50 per case 397,800 per year Exercise 3-34 (Algo) Basic Decision Analysis Using CVP (LO 3-1) Assume that the company plans to sell 76,200 units annually. Consider requirements (b), (d). and (d) independently of each other. Required: a. What will be the operating profit? b. What is the impact on operating profit if the sales price decreases by 20 percent? Increases by 10 percent? Note: Do not round intermediate calculations. c. What is the impact on operating profit if variable costs per unit decrease by 20 percent? Increase by 10 percent? Note: Do not round intermediate calculations. d. Suppose that fixed costs for the year are 20 percent lower than projected and variable costs per unit are 20 percent higher than projected. What impact will these…

FunTime Company produces three lines of greeting cards: scented, musical, and regular.Segmented income statements for the past year are as follows: Kathy Bunker, president of FunTime, is concerned about the financial performance of her firmand is seriously considering dropping both the scented and musical product lines. However,before making a final decision, she consults Jim Dorn, FunTime’s vice president of marketing.Required:1. CONCEPTUAL CONNECTION Jim believes that by increasing advertising by $1,000($250 for the scented line and $750 for the musical line), sales of those two lines wouldincrease by 30%. If you were Kathy, how would you react to this information?2. CONCEPTUAL CONNECTION Jim warns Kathy that eliminating the scented and musicallines would lower the sales of the regular line by 20%. Given this information, would it beprofitable to eliminate the scented and musical lines?3. CONCEPTUAL CONNECTION Suppose that eliminating either line reduces sales of theregular cards by…

The Knot manufactures men’s neckwear at its Spartanburg plant. The Knot is considering implementing a JIT production system. The following are the estimated costs and benefits of JIT production: a. Annual additional tooling costs $250,000 annually. b. Average inventory would decline by 80% from the current level of $1,000,000. c. Insurance, space, materials-handling, and setup costs, which currently total $400,000 annually, would decline by 20%. d. The emphasis on quality inherent in JIT production would reduce rework costs by 25%. The Knot currently incurs $160,000 in annual rework costs. e. Improved product quality under JIT production would enable The Knot to raise the price of its product by $2 per unit. The Knot sells 100,000 units each year. The Knot’s required rate of return on inventory investment is 15% per year. Q. Calculate the net benefit or cost to The Knot if it adopts JIT production at the Spartanburg plant.

Riverdale Partners wants to introduce a new line of fragrances. Market research indicates that a potential fragrance would sell well in the market priced at $268.80 each. Riverdale requires an operating profit of 28 percent of costs. Required: What is the highest acceptable manufacturing cost for which Riverdale would be willing to produce the fragrance? Highest acceptable manufacturing costs