90.2K

Verified Solution

Link Copied!

Argentina Partners s concemed about the possible eflects of inflation on its aperations. Presently the company sels 66.000 units for $35 per unit The variable producson costs are $20, and fied costs amount to $760000 Production enginers have adeed management hat hey expect unit abor costs to rise by 20 percent and unit mateas costs to rise by 15 percent in the comng yea Of the $20 variable costs, 45 percent are from labor and 30 percent are from materials Varieble oveead coss ae epected to increase by 25 percent Sales prices cannot incease more than 10 percent t is stso expected that fed costs will se by3 percent as a resut of increased texes and other miscellaneous fixed charges The company wishes to maintain the same level of profit in real dollar tems t is expected that to accomplish this objective, profis must increaso by 10 percont duning the yoar Required Compute the volume in unts and the dolar sales level necessary to maintsin the present prot levesuing me mau price increase is implemented 6. Compute the volumne of sales and the dolar sales level necessary to provide the 10 pecent increase in pros auing t he maximum price increase is inplemented c.if the volume of sales were to remain at 66.000 units, what price noresse would be reaured so aman me 10 percent inoese in profs? Calculate the new price Complete this question by entering your anewers in the tabs below Requred ARequredRquired C Camoute the velume in units and the dolar sales level necessery to maintain the present prefit level, asuming thet the maximum price inereese is implemented (Do not round intermediate caloulations. Round o your answe units" to the neareat whole number and round your answer for "Sales" to the nearet whole dlar amount3 Velue in unts Sals Argentina Partners is concemed about the possible efects of inflation on ts operations Presently the company sels 66.000 unts for $35 per unt The variable procuction costs are $20, and fed coss amoune to $760000 Production engineers heve advsed management that they expect unit labor costs to rise by 20 percent and unit materials costs to rise by 15 percent in the coming year or the $20 varieble costs, 45 percent are from lebor and 30 percent are from materiels. Verieble ovehead costs are expected to increase by 25 percent Sales prices cannot increase more than 10 percent it is also expected that fwed costs will rise by 9 percent as a result of increased taes and other miscelaneous fsed charges The compeny wishes to maintain the same level of prott in real dolar terms t sexpected that to accompsh s oectve profts must increase by 10 percent during the year Required Compute the velumen units and the dolar sales evel necessary to m the present profw g te mmum price increase is implemensed 6 Compute the volume of sales and the dolar ses level necessary to provide the 10 percent noesen pro ng mat e macmum price increese is implemented & If the volume of sales wese to remain at 66.000 unts, what price increase woud be reaured to amn me 10 percentcesen profies? Calculate the new price. Complete this question by entering your answers in the tabs below. Required ARuired Requied Compute the volume of sales and the doar sales level necessary to provide the 10 percent increase n prtes, asuming th the maximum price increase is implemeted. (De not round intermedate caloulations. Round up your anr for " in wnts to the nearest whole sumber and round your answer for "Sales to the neaest whole delar ameun e in un Saes Argentina Partners is concermed about the possible effects of infution on its aperations Presenty, the compary sets 66.000 units for $35 per unit The variable production costs ane $20, and faed costs amount to $760,000 Production engineers have advised management that they expect unt labor costs to nse by 20 percent and unt materals costs to rise by 15 percent in the coming year or the $20 variable costs 45 percent are from lebor and 30 percent are from materiels Varable oueeed costs ane expected by 9 percent as a result of increased tases and other miscellaneous fed charges The company wishes to maintain the same level of profe in must increase by 10 percen during the year real doliar tests expected that to accomplish s ojective profts Required Compute he volumen unts and the doter swes level necessary to manan re present prot emum price increase is implemented 6. Compute the volume of sales and the dolar sales level necessary to provide the 10 percent incease in prot maximum price increase is implemented asuming mat m If the volume of sales were to remain at 66000 unes whet price increse woued be reauired to an me 10 percent ncoese in profies? Caloulate the new price Complete this question by entering your answers in the tabs belew Reined AReired Rie f the volume of sales were to remain at 66,000 units, what price increase would be required to attain the 10 percent incase in prefts Calcuate the rew price. (ound your anser to 2 denal placs) Argentina Partners is concerned about the possible effects of inflation on its operations. Presently, the company sells 66,000 units for $35 per unit. The variable production costs are $20, and fixed costs amount to $760,000. Production engineers have advised management that they expect unit labor costs to rise by 20 percent and unit materials costs to rise by 15 percent in the coming year. Of the $20 variable costs, 45 percent are from labor and 30 percent are from materials. Variable overhead costs are expected to increase by 25 percent. Sales prices cannot increase more than 10 percent. It is also expected that fixed costs will rise by 9 percent as a result of increased taxes and other miscellaneous fixed charges. The company wishes to maintain the same level of profit in real dollar terms. It is expected that to accomplish this objective, profits must increase by 10 percent during the year. Required: a. Compute the volume in units and the dollar sales level necessary to maintain the present profit level, assuming that the maximum price increase is implemented. b. Compute the volume of sales and the dollar sales level necessary to provide the 10 percent increase in profits, assuming that the maximum price increase is implemented. c. If the volume of sales were to remain at 66,000 units, what price increase would be required to attain the 10 percent increase in profits? Calculate the new price. Complete this question by entering your answers in the tabs below. Required A Required B Required C Compute the volume in units and the dollar sales level necessary to maintain the present profit level, assuming that the maximum price increase is implemented. (Do not round intermediate calculations. Round up your answer for "Volume in units" to the nearest whole number and round your answer for "Sales" to the nearest whole dollar amount.) Volume in units Sales Requlred A Required B>

Answer & Explanation Solved by verified expert

See Answer