contestada

XYZ makes and sells bicycle parts. Last year XYZ sold 6,000 handlebars, generating sales of $180,000. This year they are considering a new pricing strategy with a target profit goal of $72,000. They determined that for every $2 increase to the selling price, a 100 decrease in unit sales was expected. Their total costs were $100,000 with fixed costs accounting for $64,000. This year, XYZ is considering changing the selling price to $36.

a) What was XYZ's average selling price per handlebar last year?
b) What were XYZ's total variable costs last year?c)What were XYZ's average unit variable costs last year?
d) What were XYZ's average unit contribution margins ($) last year?

Respuesta :

phamdiep1810

Answer:

a. XYZ's average selling price per handlebar last year was $30

b.

XYZ's total variable costs last year were $36,000

c. XYZ's average unit variable costs last year were $6

d. XYZ's average unit contribution margins ($) last year were $24

Explanation:

a.

XYZ's average selling price per handlebar last year = Total Sales/number of handlebars sold = $180,000/6,000 = $30

b.

XYZ's total variable costs last year = total costs - fixed costs = $100,000 - $64,000 = $36,000

c. XYZ's average unit variable costs last year = Total variable costs/number of handlebars = $36,000/6,000 = $6

d. XYZ's average unit contribution margins ($) last year = Selling price per handlebar - average unit variable costs = $30 - $6 = $24

The price which the consumers pays for a service or product is called the selling price while the variable cost is the amount that varies according to the companies sale and produce.

The prices are a) $30, b) $36000, c) $6 and d) $24.

The values can be estimated as:

Given,

  • Number of handlebars sold = 6000

  • Annual sales = $180,000

  • Profit Goal = $72,000

  • Total cost = $100,000

  • Fixed cost = $64,000

  • Selling Price = $36

a. XYZ's average selling price (SP) per handlebar last year:

[tex]\rm Selling\; Price = \dfrac {Total \;Sales}{Number\; of\; handlebars\; sold}[/tex]

[tex]\rm Selling\; Price = \dfrac {\$ \;180,000}{6000}\\\\= \$30[/tex]

b. XYZ's total variable costs (VC) last year:

[tex]\rm Variable\; cost = Total\; costs - Fixed \;costs[/tex]

[tex]\rm VC = \$100,000 - \$64,000 \\\\= \$36,000[/tex]

c. XYZ's average unit variable costs (VC) last year:

[tex]\rm VC = \dfrac {Total \;variable \;costs}{Number\; of \;handlebars}[/tex]

[tex]\rm VC = \dfrac{\$36,000}{6,000} \\\\= \$6[/tex]

d. XYZ's average unit contribution margins ($) last year:

[tex]\rm Contributional\; margin = Selling\; price\; per\; handlebar - Average\; unit \;variable \;costs[/tex]

[tex]\rm Margin = \$30 - \$6 \\\\= \$24[/tex]

Thus, a) $30, b) $36000, c) $6 and d) $24 are the prices.

To learn more about selling price and variable cost follow the  link:

https://brainly.com/question/22401743

Otras preguntas