ACCT – The new CEO of Radco Manufacturing

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Description

The new CEO of Radco Manufacturing has asked for a variety of information about the operations of the firm from last year. The CEO is given the following information, but with some data missing:
Total sales revenue
Number of units produced and sold
Selling price
Operating income
Total investment in assets
Variable cost per unit
Fixed costs for the year

?
500,000 units
?
$195,000
$2,000,000
$3.75
$3,000,000

Requirements:
a. Find (i) total sales revenue, (ii) selling price, (ii) rate of return on investment, and (iv) markup percentage on full cost for this produce.
b. The new CEO has a plan to reduce fixed costs by $200,000 and variable costs by $0.60 per unit while continuing to produce and sell 500,000 units. Using the same markup percentage as in Requirement a, calculate the new selling price.

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