Hau Lee Furniture, Inc., spends 45% of its sales dollars in the supply chain and finds its current profit of $16,000inadequate. The bank is insisting on an improved profit picture prior to approval of a loan for some new equipment.Hau would like to improve the profit line to $21,000 so he can obtain the bank's approval for the loan.SalesCost of materialCurrent Situation$80,000$36,000 (45%)Production costsFixed costProfit$16,000 (20%)$12,000 (15%)$16,000 (20%)a) What percentage improvement is needed in the supply chain strategy for profit to improve to $21,000? What is thecost of material with a $21,000 profit?A decrease of ☐ % in material (supply-chain) costs is required to yield a profit of $21,000, for a new material cost of(Enter your response for the percentage decrease to one decimal place and enter your response for the newmaterial cost as a whole number.)

a) Analysing Profit ImprovementProfit Increase Needed: $21,000 desired profit - $16,000 current…

Answered: Hau Lee Furniture, Inc., spends 45% of…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

See similar textbooks

Similar questions

Kamal Fatehl production manager of Kennesaw Manufacturing, finds his profit at $22,400 (as shown in the statement below) inadequate for expanding his business. The bank is insisting on an improved profit picture prior to approval of a loan for some new equipment. Kamal would like to improve profit line to $32,400 so he can obtain the bank's approval for the loan. % of sales Sales 280,000 100% Cost of supply chain purchases 201,600 72% Other production costs 28,000 10% Fixed costs 28,000 10% Profit 22,400 8% Part 2 a) What percentage…
Describes the relationship between profit—which is the difference betweentotal revenue and total (i.e., fixed plus variable) cost—and volume of output?
Petal Providers Corporation, described in Problem 1, is interested in estimating its additional financing needs to support a rapid increase in sales next year. Last year revenues were $1 million, the net profit was $50,000, the investment in assets was $750,000, payables and accruals were $100,000, and equity at the end of the year was $450,000. The venture did not pay out any dividends and does not expect to pay dividends for the foreseeable future. A. What would be your estimate of the additional funds needed next year to support a 30 percent increase in sales? B. How would your answer in Part A change if the expected sales growth were only 15 percent?
Joel is the RM for the City Center Plaza hotel. He knows that under his franchise agreement, he pays an 8 percent franchise fee and 3 percent marketing fee on all revenue generated from room sales. Additional fees for using the hotel’s CRS are $2.00 per each room reserved. Internet service provider (IDS) related charges paid by the hotel for rooms sold through Internet sites including uberhothotels.com are $10.00 per room sold. Given this information, help Joel complete the revenue estimate worksheet presented below. Net ADR Yield Estimate Worksheet: City Center Plaza Distribution Channel Group rooms Third-party merchant Rooms sold 80 100 Standard rate $185 $160 Gross revenue Franchise fee (8%) Franchise marketing fee (3%) Franchisor's CRS fee ($2 per room) IDS fee Net total revenue Net ADR yield
May Clothing is a retail men’s clothing store. May’s variable cost is $20 per shirt and the sales price is$40 per shirt. May plans to sell 400,000 shirts for the year and, at this level, would generate a beforetax profit of $2,500,000. What is the degree of operating leverage (DOL) at this volume level?
Bamburi Cement is a cement manufacturing company that has been operating in Kenya for more than ten years. The supply chain of Bamburi includes the suppliers and customers. Effective management of the supply chain relationships is a critical factor in ensuring increased profits by Bamburi. Required; Explain two ways that adoption of a modern Enterprise resource planning software such as Microsoft Navision would enable Bamburi to improve the supply chain relationships with the suppliers and customers. (b) Explain two ways that a well-developed and designed Accounting system would add value for an organization such as Strathmore University.
Dr.Immanuel Johnson started his carreer as a private medical practitioner during later part of 1996. He had his own poly-clinic. During 2000, he was called by a corporate hospital to consult. Dr.Johnson went on become the director of the corporate hospital in 2016. With over two decades of professional experience, he quit the hospital in 2018 and started a100 bedded hospital near his county. The finance statements for 2020 indicated that his hospital earned a marginal profit. Dr.Johnson is happy that the hospital income surpasssed expenditure!. If your were Dr.Johnson, what strategies you are going to use to stabilize the growth. Explain in 300 words.
One of your customers is delinquent on hisaccounts payable balance. You’ve mutually agreed to a repayment schedule of $700per month. You will charge 1.3 percent per month interest on the overdue balance. Ifthe current balance is $21,500, how long will it take for the account to be paid off ?
Q: How and why companies move from one revenue model to another to achieve success? Give solid reason to satisfy your answer. elaborate and explain in simple words.
Income taxes have the effect of Select one : a decreasing the cost of capital for the firm. B. None of these c. decreasing the cost of debt. D. increasing the cost of debt
H2. The owner of Alliance Food Wholesalers, Joe Slow, has asked for your advice. Alliance has been in business for over 30 years and has been in a slow growth pattern for the past decade. Mr. Slow has been dissatisfied with the returns from his business and wonders if there is anything he might do to enhance his returns. What might be your logical recommendations to Mr. Slow? A. Issue new stock to the public to increase funds available for investment. B. Borrow more money from lenders and use the proceeds to repurchase shares of stock. C. Consider selling the business to an interested party. D. Increase prices on his products.
Your friend Brianna is considering getting a credit card. She is going to use the credit card to help build her credit. The credit card she is considering has an APR of 24.99% and it also has a yearly fee of $150.00 but it does offer 1% cash back on most purchases. She asks you for your advice. Should Brianna get the credit card?

SEE MORE QUESTIONS

Recommended textbooks for you

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Operations Management

ISBN:

9781259667473

Author:

William J Stevenson

Publisher:

McGraw-Hill Education

Operations and Supply Chain Management (Mcgraw-hi…

Operations Management

ISBN:

9781259666100

Author:

F. Robert Jacobs, Richard B Chase

Publisher:

McGraw-Hill Education

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Operations Management

ISBN:

9781259667473

Author:

William J Stevenson

Publisher:

McGraw-Hill Education

Operations and Supply Chain Management (Mcgraw-hi…

Operations Management

ISBN:

9781259666100

Author:

F. Robert Jacobs, Richard B Chase

Publisher:

McGraw-Hill Education

Business in Action

Operations Management

ISBN:

9780135198100

Author:

BOVEE

Publisher:

PEARSON CO

Purchasing and Supply Chain Management

Operations Management

ISBN:

9781285869681

Author:

Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:

Cengage Learning

Production and Operations Analysis, Seventh Editi…

Operations Management

ISBN:

9781478623069

Author:

Steven Nahmias, Tava Lennon Olsen

Publisher:

Waveland Press, Inc.

SEE MORE TEXTBOOKS