Hau Lee Furniture, Inc., spends 55% of its sales dollars in the supply chain and finds its current profit of $5,000 inadequate. The bank is insisting on an improved profit picture prior to approval of a loan for some new equipment. Hau would like to improve the profit line to $10,000 so he can obtain the bank's approval for the loan.
| Current Situation | |
| Sales | $100,000 |
| Cost of Material | $55,000 (55%) |
| Production Costs | $25,000 (25%) |
| Fixed Costs | $15,000 (15%) |
| Profit | %5,000 (5%) |
Please help with part B.
Homework Answers
Part B:
Assuming that all other costs would be a fixed proprtion of sales, except fixed cost, we can rewrite the statement as:
| Current Situation | Proposed | |
| Sales | 1,00,000 | 125000 |
| Cost of Material | 55,000 | 68750 (55%) |
| Production Costs | 25,000 | 31250 (25%) |
| Fixed Costs | 15,000 | 15000 (12%) |
| Profit | 5,000 | 10,000 |
Therefore the ans would be,
An increase of 25% in sales is required to yield a profit of $10,000, for a new level of sales of $ 125,000.
Add Answer to:
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Hau
Lee Furniture, Inc., spends
50%
of its sales dollars in the supply chain and finds its
current profit of $28,000 inadequate. The
bank is insisting on an improved profit picture prior to approval
of a loan for some new equipment. Hau would like to improve the
profit line to $33,000 so he can obtain
the bank's approval for the loan
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Question also asks: PLEASE
ANSWER
b) What percentage improvement is needed in the sales
strategy for profit to improve to $20,000? What must sales be
for profit to improve to 20,000?
Hau Lee Furniture, Inc., spends 55% o its sales dollars in the supply chain and finds its current profit of $15.000 equipment. Hau would like to improve the profit line to $20,000 so he can obtain the ban's approval for the loan adequate. The bank is insisting on an...
a) What percentage improvement is needed in the supply chain
strategy for profit to improve to $40,000? What is the cost of
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to yield a profit of $40,000 for a new material cost of
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for profit to improve to $40,000? What must sales be for profit to
improve to $40,000?
An increase of __%...
Margaret Williams, production manager at Williams Manufacturing,
finds her profits at $15,000 inadequate for her business. The bank
is insisting on an improved profit picture prior to an approval of
a loan for some new equipment. Margaret would like to improve the
profit line to $25,000 so she can obtain the approval for the
loan.
Given the information below and using a Sales Strategy, what
percentage change of sales would need to be increased to achieve a
$25,000 profit?
FACTOR...
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