a.Turnover = Sales/Total assets
Hence, Current sales = 0.4*400,000 = $160,000
b.Current ROI = Margin*Turnover
= 32%*0.4
= 12.8%
Required Turnover to earn same ROI = 12.8%/20% = 0.64
Hence, required sales = 0.64*400,000 = $256,000
c.Amount of increase in sales required = 256000-160,000
= $96000
i.e. 60%
d.Extensive campaign might lead to decrease in margin due to costs of advertising
e.Alternative strategy is to offer differentiated products so that he can have higher price
Check my world Charlie's Furniture Store has been in business for several years. The firm's owners...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 40% per year for several years, but turnover has been a relatively low 0.6 based on average total assets of $3,000,000. A discount furniture store is about to arlie's, and management is considering lowering prices to compete effectively. Required: a. Calculate current sales...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 40% per year for severa relatively low 0.6 based on average total assets of $3.000.000. A discount furniture store is about open in the area served by Charlie's, and management is considering lowering prices to compete effectively. Required: a. Calculate current sales and...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service" operation that provides lots of assistance to its customers. Margin has averaged a relatively high 32% per year for several years, but turnover has been a relatively low 0.4 based on average total assets of $800,000. A discount furniture Store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service" operation that provides lots of assistance to its customers. Margin has averaged a relatively high 33% per year for several years, but turnover has been a relatively low 0.2 based on average total assets of $1,200,000. A discount furniture Store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 40% per year for several years, but turnover has been a relatively low 0.6 based on average total assets of $3,000,000. A discount furniture store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 40% per year for several years, but turnover has been a relatively low 0.6 based on average total assets of $3,000,000. A discount furniture store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 40% per year for several years, but turnover has been a relatively low 0.6 based on average total assets of $3,000,000. A discount furniture store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 34% per year for several years, but turnover has been a relatively low 0.2 based on average total assets of $1,200,000. A discount furniture Store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high- service operation that provides lots of assistance to its customers. Margin has averaged a relatively high 40% per year for several years, but turnover has been a relatively low 0.6 based on average total assets of $3,000,000. A discount furniture store is about to open in the area served by Charlie's, and management is considering lowering prices to compete...
Charlie's Furniture Store has been in business for several years. The firm's owners have described the store as a "high-price, high-service" operation that provides lots of assistance to its customers. Margin has averaged a relatively high 26% per year for several years, but turnover has been a relatively low 0.4 based on average total assets of $800,000. A discount furniture Store is about to open in the area served by Charlie's, and management is considering lowering prices to compete effectively....