Purchase Solution

Cost-Volume-Profit Analysis And ROI

Not what you're looking for?

Ask Custom Question

Posters.co, the company is a small internet retailer of high quality posters. The comapny has $1,000,000 in operating assets and fixed expenses of $150,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $3,000,000 per year. The company's contribution margin is 25% which means that an additional dollar of sales results in additional contribution margin, and net operating income of 25 cents.
1. Complete the following table showing the relationship between sales and ROI.
2. What happens to the company's ROI as sales increase? Explain

Attachments
Purchase this Solution
Solution Summary

This solution helps with a problem involving cost-volume-profit analysis.

Solution provided by:
Manal Elkhoshkhany, MBA
Education
  • BA, Ain Shams University, Cairo Egypt
  • MBA, California State University, Sacramento
Recent Feedback
  • "ty i have more need help with"
  • "ty i have jmore i need help with"
  • "great help"
  • "excellent help"
  • "Very helpful and easy to understand."
Purchase this Solution
Free BrainMass Quizzes
Paradigms and Frameworks of Management Research

This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

Social Media: Pinterest

This quiz introduces basic concepts of Pinterest social media

Managing the Older Worker

This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce

Team Development Strategies

This quiz will assess your knowledge of team-building processes, learning styles, and leadership methods. Team development is essential to creating and maintaining high performing teams.

View More Free Quizzes
Related BrainMass Solutions

  • Markup percentage and target selling price

    50,000 = $20 Total cost = 113+20 = $133 Desired Profit = $6 Markup percentage = 6/133 = 4.51% Target selling price = 133 X (1+4.51%) = $139 (b) Now the volume is 40,000 units Profit per unit = 300,000/40,000 = $7.50 Variable cost per unit = $113

  • mark up percentage and target selling price

    Now, the desired ROI= 25% of 1,200,000 or 300,000 dollars Therefore, we will add 300,000 dollar worth of profit to the total cost of 6650000= 6950000 Target price: 6950000/ 50,000 units or $139 B.

  • Activity Based Cost Accounting & CVP Excercise

    311366 Cost Accounting Vid-saver, Inc., has five activity cost pools and two products (a budget tape rewinder and a deluxe tape rewinder).

  • Quantitative Methods of Analysis

    Explain how the location of each curve graphed in question 7b would be altered if (1) total fixed cost had been $100 rather than $60 and (2) total variable cost had been $10 less at each level of output. 5) ROI analysis using DuPont model. a.

  • Fixed, Total Variable and Total Costs

    analysis using DuPont model. 2.

  • Cost per session, target price, ROI

    ROI on investment= 20% of 2,058,000= $411600 Total ROI per session= $411600/1000 session= 411.6 c) Mark up percentage per session: Per session profit/ per session cost = $411.6/$1960= 21% per session d) Target price per session= $1960 + 411.6

  • Quantitative Reasoning Excercises

    ROI analysis using DuPont model. a.Firm D has net income of $27,900, sales of $930,000, and average total assets of $465,000. Calculate the firm's margin, turnover, and ROI. b.Firm E has net income of $75,000, sales of $1,250,000, and ROI of 15%.

  • Performance Measures Other than Variance Analysis

    442115 Variance analysis as a performance measure: What about ROI and EVA Variance analysis receives some criticism as a performance measure. What about other measures such as ROI (Return on investment) and EVA (Economic value added)?

  • Measuring Financial Returns on IT Investments

    TCO is all about total cost whereas ROI is the complete financial analysis of the project/product's cost ROI is not necessarily measure the actual money coming in from the investment and can be measure in terms of customer satisfaction due to features

View More Related Solutions