prestige telephone compny

Explain the corresponding impact on total revenue for each of the three price ranges identified in part G.

Review of ABC Company and the directions it is targeting. The strategy of the company is to lift the expected sales in an aggressive fashion, with the expected end target being to triple the current levels. The plan is to push sales into the targeted range of $3 million within 3 years versus the current amount which sits at $1.2 million. We will identify the perceived risk factors that may impact this aggressive strategy and its successful execution. The following will be those risk factors:

Revenues and Direct Costs are as follows: $16,000,000 in total revenues, $9,833,155 in direct expenses, $6,166,845 in contribution margin, and 38.5% in percent of revenues. Their indirect costs are as follows: $1,200,000 in facilities costs, $1,600,000 in general overhead, and $2,800,000 in total overhead. This leaves the OP

In our second assumption, instead of using the cost of goods per cases in 1986, we try to use the percentage it counts in the total expenses which is 50.4% and to find the sales needed to break-even. The detail of the calculation is shown in the answer for questions d. The result is that 95,635, a little bit higher than the estimated sales of 90,000.

= Unit Selling Price – Unit Variable Cost = $9.00 – ($1.25 + $0.35 + $1.00) = $6.40

Irrelevant Costs, Insurance (General Liability, Physical Damage, Workers Compensation, Health insurance), Security, Depreciation, Salaries Benefits, Bad Debt Expense, Permits, Rental Equipment, Payroll Taxes, Accounting Fees, Supplies, Computer Maintenance, Miscellaneous.

Rent, custodial services, computer leases, maintenance, depreciation, salaried staff wages, administration, sales, systems development, sales promotion, corporate services

3. For each of the individual overhead accounts at Bridgeton, do you believe the given cost is variable, fixed, or something else? Why? (Use information or evidence from the case to support your evaluation, if possible. For most of these costs, there is no single right answer from the case information, so the goal is to come up with a reasonable estimate.)

(b) Calculate by how much the proposed addition will either increase or reduce operating income. Show all work.

service to other companies and organizations. It was necessary for these two companies to be

Current funds allocated to advertising and sales promotion is 3% of net sales ($80,000,000) = $360,000

The prestige Data Services grew from the needs of the Prestige Telephone Company to meet their needs of data handling at the time but the problem now is that the company is still operating at a loss. But is that a problem for the parent company? We do not think so, if the Prestige Data Services does not exist anymore, the Prestige Telephone still have to pay for the cost such as: lease, maintenance, computer services..., but they get no contribution.

Revenue: (205 hours x $400) + (97 hours x $1,000) = $82,000 + $97,000 = $179,000

Kimmel, P. D., Weygandt, J. J., & Kieso, D. E. (2009). Accounting: Tools for business decision

2. What is the total cost? How much of the total cost are labor costs? Capital costs?