Well analyzed and written answers to the information and questions below
December 25, 2020Using essay format and structure, develop a personal leadership model
December 25, 20202-page well address answers to the document shown.
In a 2-page document, address the following based on the provided company cost data:
- What is the break-even sales in units?
- If Barnwell Brothers is subject to an effective income tax rate of 40%, how many units would Barnwell Brothers have to sell to earn an after-tax profit of $90,000?
- If fixed costs increase $31,500 with no other cost or revenue factors changing, what is the break-even sales in units?
- How would these calculations affect decision making for managers at Barnwell Brothers? Why?
- What recommendation(s) would you suggest for reducing costs at Barnwell Brothers? Justify your recommendations using linear profit modeling.
Barnwell Brothers Company
Data for the Barnwell Brothers Company are as follows:
|
Sales (100,000 units) |
|
$500,000 |
||
|
Costs |
|
Fixed |
Variable |
|
|
Raw material |
$ 0 |
$150,000 |
||
|
Direct labor |
$0 |
$100,000 |
||
|
Factory costs |
$50,000 |
$75,000 |
||
|
Selling and administrative costs |
|
$55,000 |
$25,000 |
|
|
Total costs |
|
$105,000 |
$350,000 |
$455,000 |
|
Operating income |
|
$45,000 |