Question

You are the new marketing director for a manufacturer of shelf stable juices that are sold under the Mackinac Island Grower (MIG) label. Your juices are sold to retail grocery chains in the Midwest. The general manager has asked you to compare the profitability of two potential products M.I. Gold (Gold) and Michigan Rose (Rose) blend. The company has two alternatives for converting pure grape juice into bottled juice. It can be bottled as a premium juice and sell an estimated 15,000 cases under the Gold label. Or, the juice can be diluted (under the Rose label) and sell approximately 31,000 cases. The suggested retail price of the Gold label would be $58.50, while the Rose label would retail for $36.85. Retailers earn a 35% markup on the retail selling price, while distributors earn a margin of 10%. The company estimates that fixed costs will be $120,000 for the Gold label and $85,000 for the Rose label. The following table summarizes the variable cost per case for each alternative. Gold Rose Blend Blend Juice $8.040 $6.226 Container/Packaging 2.929 2.500 Lids and Caps .277 .185 Labels 130 .075 Direct Labor .200 .200 Overhead 960 1960 Trade Promotion 2.00 .750 Based on the above answer the following:

PLEASE ANSWER ALL PARTS

1). What is the retailers markup in dollars per case for gold blend?

2). What is the retailers markup in dollars per case for rose blend?

3). Mackinac Island Contribution (Dollars/Case) for gold blend?

4). Mackinac Island Contribution (Dollars/Case) for rose blend?

5.) Mackinac Island Contribution (Percentage%) gold blend

6.) Mackinac Island Contribution (Percentage%) rose blend

7.) Number of units needed for break-even gold blend

8.) Number of units needed for break-even rose blend

9.) Profit if sales estimate for Gold blend is met

10.) Profit if sales objective for Rose blend is met