Salem Telephone Case
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Title: Salem Telephone Case

Essay Details:

Subject: Miscellaneous
Author: Felicia H
Date: August 4, 2014
Level: University
Grade: A
Length: 3 / 627

Essay text:

Assume that intra company usage is 205 hours. Assume commercial usage is at the March level. Sales - intracompany 205 @ $400 Variable Expenses Detailed Sales - commercial 138 @ $800 Power 1,612 1,417 1,807 Personnel 8,232 7,238 9,226 Sales Promotion 7,853 6,905 8,800 Contribution Incomes Statement Corp. Service 15,690 13,797 17,584 Salem Data Services Total Variable 33,387 29,357 37,417 Total Per Unit Sales (343) 192,400 561 Variable Expenses 33,387 97 Contribution Margin 159,013 464 Fixed Expenses 189,620 Net Operating Income (30,607) 4) Assuming the intracompany demand for service will average 205 hours per month, what level of commercial revenue hours of computer use would be necessary to break even each month? Fixed expenses = 189,620 Per unit CM = 464 Units to break even = 409 5) Estimate the impact on income of each of the options Flores has suggested if Wu estimates as follows: a) Increasing the price to commercial customers to $1,000 per hour but reduce demand by 30% Sales - intracompany 205 @ $400 82,000 Per Unit Sales - commercial 96...

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