What is the break-even point for both options? What profit would the expected sales of each option achieve? How many boxes of each option would Heriot and Watt have to sell if they wanted to achieve a profit of £800.
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Heriot and Watt are planning to open a small shop selling lunch boxes, which they will prepare on the premises. After experimenting for some weeks Heriot and Watt have arrived at two possible lunch box sets, which they think will be popular: Lunch Box A and Lunch Box B. As they can only prepare one lunch box on the premises, they need to decide, which one to choose. The following information is available:
Lunch Box A:
- Selling price £8
- Ingredients £3
- preparation time £1
- Biodegradable box £0.50
Lunch Box B:
- Selling price £7
- Ingredients £2
- preparation time £0.70
- Biodegradable box £0.50
Required:
You are tasked to help Heriot and Watt to make their decision and provide the information below:
- What is the break-even point for both options?
- What profit would the expected sales of each option achieve?
- How many boxes of each option would Heriot and Watt have to sell if they wanted to achieve a profit of £800.
- Heriot and Watt are considering a selling price increase of 10% for both lunch box options. How many boxes of each option would they have to sell to achieve a target profit of £900?
- Based on the information calculated above (a – d) explain, which option Heriot and Watt should choose: Lunch Box A or Lunch Box B. You should also consider if the information you calculated is sufficient for making an informed
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- Heriot and Watt are planning to open a small shop selling lunch boxes, which they will prepare on the premises. After experimenting for some weeks Heriot and Watt have arrived at two possible lunch box sets, which they think will be popular: Lunch Box A and Lunch Box B. As they can only prepare one lunch box on the premises, they need to decide, which one to choose. The following information is available: You are tasked to help Heriot and Watt to make their decision and provide the information below: (a) What is the break-even point for both options? (b) What profit would the expected sales of each option achieve? (c) How many boxes of each option would Heriot and Watt have to sell if they wanted to achieve a profit of £800. (d) Heriot and Watt are considering a selling price increase of 10% for both lunch box options. How many boxes of each option would they have to sell to achieve a target profit of £900? (e) Based on the information calculated above (a – d) explain, which…Colin OShea has a carpentry shop that employs 4 carpenters. Colin received an order for 1,000 coffee tables. The coffee tables have a round table top and four decorative legs. An offer for $500 per table was received. Colin found an unfinished round table top that he could buy for $50 each. A. Using this quantitative cost data to make the table top, should Colin buy the table top or make it? B. What qualitative factors would be included in your decision. B. Can the vendor make it to the same quality standards? Can it be completed on time? Is there idle capacity in the factory that could be used?Garrison Boutique, a small novelty store, just spent $4,000 on a new software program that will help in organizing its inventory. Due to the steep learning curve required to use the new software, Garrison must decide between hiring two part-time college students or one full-time employee. Each college student would work 20 hours per week, and would earn $1 S per hour. The full-time employee would work 40 hours per week and would earn $15 per hour plus the equivalent of $2 per hour in benefits. Employees are given two polo shirts to wear as their uniform. The polo-shirts cost Garrison $10 each. What are the relevant costs, relevant revenues, sunk costs, and opportunity costs for Garrison?
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- Olga was planning to set up a business where she would purchase paintings for $1,050 per unit and sell them for $1,800 per unit. She wanted to conduct a break-even analysis and identified the following costs for running her business: $4,470.00 per month for store leasing, $54 per month website hosting fee, $5,150 per month for staff salary, $2,040 per month for advertising costs, and $25 per unit for labour charges to pack the paintings. a. How many paintings would she have to sell per month to break-even? Round up to the next whole number b. If she wants to make a profit of $24,000 in a month, how many paintings would she have to sell? Round up to the next whole numberCrepe Creations (CC) is considering franchising its unique brand of crepes to stall- holders on Hermoza Beach, which is four miles long. CC estimates that, on an average day, there are 1,000 sunbathers evenly spread along the beach and each sunbather will buy one crepe per day provided that the price plus any disutility cost does not exceed $5. Each sunbather incurs a disutility cost of getting up from resting to get a crepe and returning to their beach spot of 25 cents for every 1⁄4 mile the sunbather has to walk to get to the CC stall. Each crepe costs $0.50 to make and CC incurs a $40 overhead cost per day to operate a stall. What price should CC charge if it only has one store? What profit would CC gain if it only has one store? How many franchises should CC award given that it determines the prices the stall holders can charge and that it will have a profit-sharing royalty scheme with the stall holders? What is price of a crepe at each stall?A businessman must decide whether to open a new mini grocery branch or simply extend the number of hours of its operation on its existing branch with a payoff of P 150,000. According to his friend, demand at the new location can either be low or high, which the probabilities are estimated to be 0.35 and 0.65, respectively. If a new branch is opened and demand proves to be low, there is no need to operate on a 24-hr basis but instead, they will stick to 12-hrs operation with a payoff of P 100,000 or enhance marketing strategy through advertising. Projected response to advertising may either be favorable or not favorable, with estimated probabilities of 0.40 and 0.60, respectively. If demand is favorable, the payoff grows to P 310,000 and if response is unfavorable, the payoff is P 120,000. The cost of advertising is P45,000. Required: a. Draw a decision tree b. Determine the expected value for each decision and event nodes. c. Which alternative is the best for the…
- Can some one double check this for me? You plan to open a small business for manufacturing pet collars, leashes, and harnesses. You have found a workshop space you can use for sewing your products. After some research and planning, you have estimates for the various operating costs for your business. The total square footage for the sewing rooms is 1,500 square feet broken into three areas (500 square feet each). You have taken out a loan for start-up costs, and the monthly payment is $550; it goes into effect immediately and should be accounted for in your costs. You will also collect a modest salary for the first year of $500 per month; remember to divide evenly among the services. Salary and Hiring Data · One collar maker, who will be paid $16.00 per hour and work 40 hours per week · One leash maker, who will be paid $16.00 per hour and work 40 hours per week · One harness maker, who will be paid $17.00 per hour and work 40 hours per week · One receptionist, who will be paid…Suppose that a sales force has found 20 qualified buyers and has begun the salesprocess. The sales manager estimates that 10% eventually proceeds to make a purchase.Assume that a professional company offers three services, priced at $2,000, $7,000 and$20,000, respectively. Based on past results or the sales manager’s estimates, you projectthat 60% of first-time buyers will choose the cheapest option, 30% will choose the middleoption and 10% will choose the most expensive option. b. How many qualified buyers must be found in order for the company to generate $80,000 in sales in a given period? Your final answer must be rounded to the nearest wholenumber.a retailer in the home improvement industry, currently operates seven retail outlets in Manama and Dubai. Management is contemplating building an eighth retail store across town from its most successful retail outlet. The company already owns the land for this store, which currently has an abandoned warehouse located on it. Last month, the marketing department spent $10,000 on market research to determine the extent of customer demand for the new store. Now Noor Supply must decide whether to build and open the new store. Which of the following should be included as part of the incremental earnings (or cash flow) for the proposed new retail store? The cost of the land where the store will be located. The cost of demolishing the abandoned warehouse and clearing the lot. The loss of sales in the existing retail outlet, if customers who previously drove across town to shop at the existing outlet become customers of the new store instead. The $10,000 in market research spent to…
