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Variable Direct Costs Machine Hours Fixed Production Costs Fixed Overhead Costs Units Sold Unit Selling price...

Variable Direct Costs Machine Hours Fixed Production Costs Fixed Overhead Costs Units Sold Unit Selling price Machine Hours per Unit Total Sales Dollars Variable Cost per Unit Total Contribution Dollars Contribution Dollars per Unit Contribution Margin Percentage
Item #1 $65,000 10000 $25,000 $2,000 22500 $10
Item #2 $55,000 20000 $22,000 $2,500 23000 $8
Item #3 $42,000 7500 $15,000 $1,750 27500 $7
Item #4 $27,000 5000 $5,000 $500 11000 $6
Complete the grey cells in the above table
Which product would you recommend increasing market share? Support your answer in 1-2 paragraphs

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Variable Direct Costs Machine Hours Fixed Production Costs Fixed Overhead Costs Units Sold Unit Selling price Machine Hours per Unit Total Sales Dollars Variable Cost per Unit Total Contribution Dollars Contribution Dollars per Unit Contribution Margin Percentage Net profit Market share
Item #1 $65,000 10000 $25,000 $2,000 22500 $10 0.44 $225,000 $2.89 $160,000 16000 71.1 $133,000 0.337079
Item #2 $55,000 20000 $22,000 $2,500 23000 $8 0.87 $184,000 $2.39 $129,000 16125 70.11 $104,500 0.275655
Item #3 $42,000 7500 $15,000 $1,750 27500 $7 0.27 $192,500 $1.53 $150,500 21500 78.2 $133,750 0.28839
Item #4 $27,000 5000 $5,000 $500 11000 $6 0.45 $66,000 $2.45 $39,000 6500 59.1 $33,500 0.098876
Total sales $667,500
1
Market share represents the percentage of an industry or market's total sales that is earned by a particular company over a specified time period. Market share is calculated by taking the company's sales over the period and dividing it by the total sales of the industry over the same period. This metric is used to give a general idea of the size of a company in relation to its market and its competitors.
From the above data we can conclude that the market share for ITEM #1 is higher when compared with remaining products, beacause of its higher sales.
We can also see that even thought net profit is lower for item 1 when compared to item 3 it is beacause of its higher fixed costs

ekkarill92 answered 1 year ago
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