Show all your companions prope ng me *Norfitel Corp. is offering a new model of...

70.2K

Verified Solution

Question

Accounting

image
Show all your companions prope ng me *Norfitel Corp. is offering a new model of its smartphone for $300 at retail price. In their marketing channel, wholesalers run the bulk logistics downstream while retailers conduct the point of sales & merchandising functions. Retailers command a 25% margin: the Wholesalers charge 15% margin. Norfitel has a fixed cost budget which includes the following: $5 Million for sales & distribution operations, $3 Million for advertising & promotions via television/internet social-media venues, $2 Million for general & administrative expenditures toward managing this product line. Per Unit, their variable cost structure as part of this assemble-to-order operation comprises of the following activities: $40 for purchase procurement of the electronic components/circuitries/sub-assemblies, $25 for direct labor & production S10 for finishing quality assurance/packaging-&-labeling, It forecasts selling 1 Million units in the first year The development team has also been granted an appropriation of $3.25 Million toward strategic purposes of market research, technical design, product engineering, & telecommunication systems integration configurations applied for this model and their future competitive/innovative offerings. (a). - What is Norfitel's Unit Selling Price for this model? (b). - What is the break-even volume for this model in units and in dollars? Explain in business marketing language what this break-even volume means. - What metric would you compare this break-even volume with to check if it's feasible? (c). - Compute the estimated Profit (in S) based on the analyses thus far, considering that their goal is to distribute & sell the forecasted 1 Million units. (d). NOW. the financial allocator is requiring this model to also achieve a 10% ROI (return on investment) to justify its fair utilization of the $3.25 Million strategic advancement budget. Thus, what does the relevant fixed costs NOW become? Compute the necessary sales volume in units required to achieve this 10% ROI. - To this effect, are you using the method of expensing' or 'capitalizing for recovery of this relevant fixed costs? (e). -- If Norfitel targets a profit of $50 Million in this line, what should be its sales figures in units? (). Nortitel plans to start offering a S10 promotion on each unit sold after break-even is achieved. If the target is to still earn a profit of $50 Million in this line (factoring in the $10 promotion after break-even), what should be its revised sales figures in units

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students