5 Revenue mix, new and upgrade customers. Zapo 1-2-3 is a top-selling spreadsheet product. Zapo is about to release Version 5.0. It groups its customers into groups new customers and upgrade customers (those who previously purchased Zapo 1-2-3 Version 4.0 or earlier). Although the same physical product is provided to each customer group, sizable differences exist in their selling prices and variable marketing costs: Selling price Variable cost: Manufacturing Marketing New Customers $25 65 $210 90 a. New 50% / upgrade 50% b. New 90% / upgrade 10% Upgrade Customers $120 $25 15 40 The fixed costs of Zapo 5.0 are $14,000,000. The planned revenue mix in units is 60% new customers and 40% upgrade customers. REQUIRED 1. What is the Zapo 1-2-3 Version 5.0 breakeven point in units, assuming that the planned 60/40 mix is maintained? 2. If the mix is maintained, what is the operating income when 200,000 units are sold? 3. Show how the breakeven point in units changes with the following customer mixes:

5 Revenue mix, new and upgrade customers. Zapo 1-2-3 is a top-selling spreadsheet product. Zapo is about to release Version 5.0. It groups its customers into groups new customers and upgrade customers (those who previously purchased Zapo 1-2-3 Version 4.0 or earlier). Although the same physical product is provided to each customer group, sizable differences exist in their selling prices and variable marketing costs: Selling price Variable cost: Manufacturing Marketing New Customers $25 65 $210 90 a. New 50% / upgrade 50% b. New 90% / upgrade 10% Upgrade Customers $120 $25 15 40 The fixed costs of Zapo 5.0 are $14,000,000. The planned revenue mix in units is 60% new customers and 40% upgrade customers. REQUIRED 1. What is the Zapo 1-2-3 Version 5.0 breakeven point in units, assuming that the planned 60/40 mix is maintained? 2. If the mix is maintained, what is the operating income when 200,000 units are sold? 3. Show how the breakeven point in units changes with the following customer mixes:

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter13: Nonlinear Optimization Models

Section: Chapter Questions

Problem 5P: Jims Camera shop sells two high-end cameras, the Sky Eagle and Horizon. The demand for these two...

See similar textbooks

Similar questions

Zapo 1-2-3 is a top-selling electronic spreadsheet product. Zapo is about to release version 5.0. It divides its customers into two groups: new customers and upgrade customers (those who previously purchased Zapo 1-2-3, 4.0 or earlier versions). Although the same physical product is provided to each customer group, sizable differences exist in selling prices and variable marketing costs: E (Click the icon to view the price and cost information.) The fixed costs of Zapo 1-2-3 5.0 are $13,500,000. The planned sales mix in units is 60% new customers and 40% upgrade customers. Read the requirements. Requirement 1. What is the Zapo 1-2-3 5.0 breakeven point in units, assuming that the planned 60% / 40% sales mix is attained? Begin by determining the sales mix. For every bundle, units are sold to new customers, and units are sold to customer who bought upgrades. Data Table New Customers Upgrade Customers Selling price $ 225 $ 120 Variable costs Manufacturing $ 20 $ 20 60 80 25 Marketing $…
(Q.7) Data 1-2-3 is a top-selling electronic spreadsheet product Data is about to release version 5.0. 11 divides its customers into two groups: new customers and upgrade customers (those who previously purchased Data 1-2-3, 4.0 or earlier versions). Although the same physical product is provided to each customer group, sizable differences exist in selling prices and variable marketing costs: New Customers $275 Selling price Variable costs Manufacturing Marketing Contribution margin $35 65 100 $175 Upgrade Customers $100 $35 15 50 $ 50 The fixed costs of Data 1-2-3, 5.0 are $15,000,000. The planned sales mix in units is 60% new customers and 40% upgrade customers. Questions: 1. Calculate the Data 1-2-3, 5.0 breakeven point in units (number of bundles, new customers, upgrade customers) assuming that the planned 60% 40% sales mix is attained? 2. If the sales mix is altained, what is the operating income when 220,000 total units are sold? 9
Customer Value, Strategic PositioningAdriana Alvarado has decided to purchase a personal computer. She hasnarrowed the choices to two: Drantex (ad Confiar. Both brands have thesame processing speed, 6.4 gigabytes of hard-disk capacity, two USBports, and a DVDRW drive, and each comes with the same basic softwaresupport package. Both come from mail-order companies with goodreputations. The selling price for each is identical. After some review,Adriana discovers that the cost of operating and maintaining Drantexover a 3-year period is estimated to be $300. For Confiar, the operatingand maintenance cost is $600. The sales agent for Drantex emphasizedthe lower operating and maintenance costs. The agent for Confiar,however, emphasized the service reputation of the product and thefaster delivery time (Confiar can be purchased and delivered 1 weeksooner than Drantex). Based on all the information, Adriana has decidedto bur Confiar. Required:1. What is the total product purchased by Adriana?2.…
Swippy Software offers three software products: a word processing software, a spreadsheet software, and an accounting software. Information for the stand-alone selling prices and costs of its individual products is as follows: Stand-Alone Selling Price, Cost Word Processing (WP) $75 $18 Spreadsheet (SS) $90 $20 Accounting Software (AS) $65 $25 Recently, Swippy Software has begun offering software bundles, which includes all three programs at a discounted price. The bundle price for the software is $185.00 Using the unit cost as the weights, allocate the bundled price to the three programs using the stand-alone revenue-allocation method. Allocate the bundled price to the three types products using the incremental revenue-allocation method. Assume Spreadsheets is the primary product, followed by Word Processing, and then Accounting Software.
You are creating part of an Excel model that will set the price of an item based on whether the customer is a preferred customer or not. The partially completed model in the attached file. <-- Click here to download the Excel file. In cell B6, you will enter the formula that will use this logic:When preferred status is Yes, the price is the preferred price. Otherwise the price is the regular price. Customer ID: 68YJW Prices: Regular $26.95 Customer Name Reggie Greene Preferred $21.95 Preferred? Y/N: Yes Customer Price
Chapter 1: Applying Excel: Excel Worksheet (Part 1 of 2) Download the Applying Excel form and enter formulas in all cells that contain question marks. For example, in cell C18 enter the formula "= B6". After entering formulas in all of the cells that contained question marks, verify that the dollar amounts in both the traditional and contribution format income statements match the numbers in Exhibit 1-7. Check your worksheet by changing the variable selling cost in the Data area to $900, keeping all of the other data the same as in Exhibit 1-7. If your worksheet is operating properly, the net operating income under the traditional format income statement and under the contribution format income statement should now be $700 and the contribution margin should now be $4,700. If you do not get these answers, find the errors in your worksheet and correct them. Save your completed Applying Excel form to your computer and then upload it here by clicking “Browse.” Next, click…
the Victor Inc. as a custom because of COVID-19? 2. Please calculate the operating income(loss) if Scenario drop Victor Inc. as a custom. 3. Should Scenario keep Victor as a customer or just drop it? Why? Question 5: Please use an example to explain the opportunity-cost concept and why it is used in decision-making. tions: On DELL
eBook Show Me How Question Content Area Measure Maps Rizzo Goal Inc. produces and sells hockey equipment, often custom made for online orders. The company has the following performance metrics on its balanced scorecard: days from ordered to delivered, number of shipping errors, customer retention rate, and market share. A measure map illustrates that the days from ordered to delivered and the number of shipping errors are both expected to directly affect the customer retention rate, which affects market share. Additional internal analysis finds that: Every shipping error over 2 shipping errors per month reduces the customer retention rate by 1.5%. On average, each day above 2 days from ordered to delivered yields a reduction in the customer retention rate of 1%. Each day before 2 days from order to delivery yields an increase in the customer retention rate of 1%, on average. Rizzo Goal Inc.’s current customer retention rate is 60%. The company estimates that for every 1%…
Unit cost per order of a given size 2. An analysis of selling costs shows: (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) nces ? Management may want to consider offering discounts for large orders. ? Small orders are preferable to medium sized orders. 2 Large orders are preferable to medium sized orders. ? Marketing should be focused on small sized orders. raw lill insert Oelete F9 F10 F11 F12 F6
Which of the following are reasonable ways to deal with excess supply? (select ALL correct answers) reduce prices increase advertising use all available capacity to make the product with the highest CM per unit of capacity find special orders at a discounted price "fire" small customers
Relevant costs, opportunity costs. Gavin Martin, the general manager of Oregano Software, must decide when to release the new version of Oregano’s spreadsheet package, Easyspread 2.0. Development of Easyspread 2.0 is complete; however, the diskettes, compact discs, and user manuals have not yet been produced. The product can be shipped starting July 1, 2017. The major problem is that Oregano has overstocked the previous version of its spreadsheet package, Easyspread 1.0. Martin knows that once Easyspread 2.0 is introduced, Oregano will not be able to sell any more units of Easyspread 1.0. Rather than just throwing away the inventory of Easyspread 1.0, Martin is wondering if it might be better to continue to sell Easyspread 1.0 for the next three months and introduce Easyspread 2.0 on October 1, 2017, when the inventory of Easyspread 1.0 will be sold out. The following information is available:
A company has three types of products: gadgets, widgets, and gizmos. The cost and market price of each type is listed below. Complete the table by applying the lower of cost and net realizable value (LCNRV). Do not enter dollar signs or commas in the input boxes. Description Category Cost NRV Individual LCNRV Applied to Category Total Gadget Type 1 Gadgets $1,170 $1,000 $ Gadget Type 2 Gadgets $5,700 $5,600 $ Total Gadgets Widget A Widgets $140 $150 $ Widget B Widgets $130 $190 $ Total Widgets $ tA Gizmo 1 Gizmos $2,280 $2,450 $ Gizmo 2 Gizmos $2,280 $1,630 $ Total Gizmos Total $ A $ EA SA SA EA A