Dalafonster AB specializes in replacing windows in villas. A complete replacement of the windows in a villa has an average price of SEK 120,000. The company's special costs for the average villa are SEK 72,000. In the areas where you carry out your campaigns, 2% of homeowners usually change windows. In an area with 1000 villas, they now want to try to carry out a campaign. You have two alternative ideas to evaluate. Option 1 means that the price is reduced by 10%. Option 2 means that you instead draw a side-by-side quad bike in the area. Dalafönster pays SEK 220,000 for it. How many villas need to change windows for each of the two options to be profitable? Calculate separately. Assume that average price and special costs apply

Dalafonster AB specializes in replacing windows in villas. A complete replacement of the windows in a villa has an average price of SEK 120,000. The company's special costs for the average villa are SEK 72,000. In the areas where you carry out your campaigns, 2% of homeowners usually change windows. In an area with 1000 villas, they now want to try to carry out a campaign. You have two alternative ideas to evaluate. Option 1 means that the price is reduced by 10%. Option 2 means that you instead draw a side-by-side quad bike in the area. Dalafönster pays SEK 220,000 for it. How many villas need to change windows for each of the two options to be profitable? Calculate separately. Assume that average price and special costs apply

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 9EA: Brahma Industries sells vinyl replacement windows to home improvement retailers nationwide. The...

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