Project #57296 - Retail/Business Math

On October 1, 2005, Annie had an opening inventory at retail valued at $195,000.00 with a MU% at 61.4 percent and by the middle of November, the purchases for the season to date to carry Annie's through the busy holiday amounted to $375,000.00 at cost. Annie estimates that she has to achieve a 65 percent cumulative markup in order to meet her year-end profit projection.

Task

This week, perform the following activities.

  1. What will the total dollar value of Annie's merchandise at retail be?

  2. What is the MU% that must be applied to the purchases season to date to achieve the planned cumulative MU% of 65 percent? What course of action would be appropriate to increase MU%?

During this fall quarter, Annie hires two more part-time sales associates for 20 hours per week at an hourly rate of $8.00 to assist the increased business for the Christmas rush. She hires another part-time security guard for the quarter at an additional security cost of $2,500.00.

At the close of business on December 31, 2005, the following numbers apply.

  • Net sales for the fall quarter totaled $905,375.00 with a gross margin of $443,440.00.

  • Annie increases her advertising expense by $12,000 above her summer advertising expense to generate greater market visibility and continues promotional events started in summer with another fashion show and another fashion makeover.

  • Except as noted, all operating expenses remain same as that at the end of summer. (Remember to use 52 weeks for a year).

 

With the given information, create a skeletal P&L statement for the fall quarter.

P&L statement, Operating Expenses, Helpful hints, and exampel of a table to answer question 1 and 2 will be uploaded below

Subject Mathematics
Due By (Pacific Time) 02/15/2015 12:00 am
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