ACC - ServerSolutions’ management
Question # 00073325
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Updated on: 05/29/2015 01:01 AM Due on: 05/29/2015
ServerSolutions’ management has asked you to help the firm identify its EBDAT breakeven level. The company has only one product,
the Pinnacle Server, a blazing fast network server that accelerates corporate database network access. The firm’s servers sell for $4,500 each. Each server costs $3,000 in materials and manufacturing costs (all production is outsourced to an external manufacturer).
The firm’s office lease in Puget Sound is $210,000 annually, its magazine advertising expense is $390,000 per year, and compensation costs are $300,000 annually. Complete the following, and show all your calculations for each.
Part 1: Calculate the firm’s
a) EBDAT revenue, and b) contribution profit margin at EBDAT breakeven.
Part 2: If the firm sells 1,800 servers, what will be its c) gross profit percentage, d) operating income, and e) operating income percentage? (Show all calculations) (Points : 40)
the Pinnacle Server, a blazing fast network server that accelerates corporate database network access. The firm’s servers sell for $4,500 each. Each server costs $3,000 in materials and manufacturing costs (all production is outsourced to an external manufacturer).
The firm’s office lease in Puget Sound is $210,000 annually, its magazine advertising expense is $390,000 per year, and compensation costs are $300,000 annually. Complete the following, and show all your calculations for each.
Part 1: Calculate the firm’s
a) EBDAT revenue, and b) contribution profit margin at EBDAT breakeven.
Part 2: If the firm sells 1,800 servers, what will be its c) gross profit percentage, d) operating income, and e) operating income percentage? (Show all calculations) (Points : 40)
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Rating:
/5
Solution: ACC - ServerSolutions’ management (Solution)