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## Cost-Volume-Profit Analysis

Order ID:89JHGSJE83839Style:APA/MLA/Harvard/ChicagoPages:5-10

Instructions:Question Description

Purpose of Assignment

The Case Study focuses on CVP (Cost-Volume-Profit), break-even, and margin of safety analyses which allows students to experience working through a business scenario and applying these tools in managerial decision making.

Resources

? Generally Accepted Accounting Principles (GAAP), U.S. Securities and Exchange Commission (SEC)

? Tutorial help on Excel and Word functions can be found on the Microsoft Office website.

? There are also additional tutorials via the web offering support for Office products.

Scenario

Mary Willis is the advertising manager for Bargain Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of a new lighting system and increased display space that will add $24,000 in fixed costs to the $270,000 in fixed costs currently spent. In addition, Mary is proposing a 5% price decrease ($40 to $38) will produce a 20% increase in sales volume (20,000 to 24,000). Variable costs will remain at $24 per pair of shoes. Management is impressed with Mary’s ideas but concerned about the effects these changes will have on the break-even point and the margin of safety.

Assignment Steps -?Complete the following:

? Compute the current break-even point in units, and compare it to the break-even point in units if Mary’s ideas are used.

? Compute the margin of safety ratio for current operations and after Mary’s changes are introduced (Round to nearest full percent).

? Prepare a CVP (Cost-Volume-Profit) income statement for current operations and after Mary’s changes are introduced.

? Prepare a maximum 700-word informal memo to management addressing Mary’s suggested changes.

? Explain whether Mary’s changes should be adopted. Why or why not?

? Analyze the above information (three bullet points above) and use this information to support your suggestion.

? ? Show your work in Microsoft Word or Excel.

Complete calculations/computations using Microsoft Word or Excel.

3 Answer questions using Excel and show screenshots of equations/formule used. Explain work

(2) Solve Chapter 2, Problem 2 (30 points). Using phstat, generate box plot and dot scale diagram for all numeric columns (10 points). Use data below.

Insurance Survey

Age

Gender

Education

Marital Status

Years Employed

Satisfaction*

Premium/Deductible**

36

F

Some college

Divorced

4

4

N

55

F

Some college

Divorced

2

1

N

61

M

Graduate degree

Widowed

26

3

N

65

F

Some college

Married

9

4

N

53

F

Graduate degree

Married

6

4

N

50

F

Graduate degree

Married

10

5

N

28

F

College graduate

Married

4

5

N

62

F

College graduate

Divorced

9

3

N

48

M

Graduate degree

Married

6

5

N

31

M

Graduate degree

Married

1

5

N

z57

F

College graduate

Married

4

5

N

44

M

College graduate

Married

2

3

N

38

M

Some college

Married

3

2

N

27

M

Some college

Married

2

3

N

56

M

Graduate degree

Married

4

4

Y

43

F

College graduate

Married

5

3

Y

45

M

College graduate

Married

15

3

Y

42

F

College graduate

Married

12

3

Y

29

M

Graduate degree

Single

10

5

N

28

F

Some college

Married

3

4

Y

36

M

Some college

Divorced

15

4

Y

49

F

Graduate degree

Married

2

5

N

46

F

College graduate

Divorced

20

4

N

52

F

College graduate

Married

18

2

N

*Measured from 1-5 with 5 being highly satisfied.

**Would you be willing to pay a lower premium for a higher deductible?

(3) Chapter 3 – Solve Problem 23. (10 x 4 = 40 points)

(4) Probability Distributions.

4.1. Generate 500 random numbers between 1 and 100 using RANDBETWEEN function. (10 points)

4.2. Plot the theoretical normal and weibull probability distributions, as line plots, for range 0 to 150 based on your 500 random numbers. For Weibull distribution, use alpha = 1.8 and beta = mean of 500 values 10.

(20 points)

4.3 Show calculations and tables used to plot graphs/figures. (10 points)

(5) Joint Probability.

Solve problem 35 from chapter 3. Use data below.

Joint probability calculations (10 points). a, b and c (30 points)

Note: Round all decimal values to 3 digits of precision.

Not a High

School GradHigh School

GraduateSome College

No DegreeAssociate’s

DegreeBachelor’s

DegreeAdvanced

DegreeNever Married

4120320

7777104

4789872

1828392

5124648

2137416

Married, spouse present

15516160

36382720

18084352

8346624

19154432

9523712

Married, spouse absent

1847880

2368024

1184012

465392

670712

301136

Separated

1188090

1667010

842715

336165

405240

165780

Widowed

5145683

4670488

1765010

556657

977544

475195

Divorced

2968680

7003040

3806000

1674640

2340690

1217920

Note: For all questions, show screenshots of equations/formulae used. Explain work.

RUBRIC

Excellent Quality95-100%

Introduction45-41 points

The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.

Literature Support91-84 points

The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.

Methodology58-53 points

Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met.

Average Score50-85%

40-38 points

More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided.

83-76 points

Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration.

52-49 points

Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met.

Poor Quality0-45%

37-1 points

The background and/or significance are missing. No search history information is provided.

75-1 points

Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration.

48-1 points

There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met

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