BYP6-2 For nearly 20 years Customized Coatings features provided portrait and galvanizing services pertaining to manufacturers in the region. Companies of various material products have relied around the quality and quick transformation time furnished by Custom Films and its twenty skilled staff. During the last year, as a result of a sharp upturn throughout the economy, the company's sales have increased by 30% relative to the prior year. The organization has not been in a position to increase it is capacity fast enough, thus Custom Films has had to choose work away because it cannot keep up with consumer requests. Top rated management can be considering the getting a sophisticated automatic painting sales space. The sales space would signify a considerable relocate the path of software versus manual labour. If Custom made Coatings purchases the sales space, it would almost certainly lay away 15 of its competent painters. To assess the decision, the business compiled production information from the most recent yr and then prepared a parallel compilation let's assume that the company would purchase the new equipment and lay off of the workers. Individuals data are shown below. As you can see, the company projects that during the last yr it would have been far more rewarding if it acquired used the automated way.
Current Approach Automated Approach Revenue $2, 500, 000 $2, 000, 1000 Variable costs 1, two hundred, 000 4 hundred, 000 Contribution margin 800, 000 you, 600, 1000 Fixed costs 200, 500 600, 1000 Net income $ 600, 1000 $1, 500, 000
(a) Compute and understand the contribution margin percentage under every single approach. --Analie
(b) Compute the break-even reason for sales dollars under each approach. Go over the significance of your findings.
(c) Making use of the current standard of sales, figure out the perimeter...