university of california Operations And Supply Chain Management Assignment Help - Accounting

Question - Toy Box Inc. is contemplating expanding their sales of their children%u2019s toys. The have an
opportunity to stock and sell the X toy that has been a big hit with children everywhere. They need to
order the X toys from the manufacturer in a minimum order of 100 at a cost of $12 each. They could
resell the X toy in their store for $22 each.

Due to anticipated demand, Toy Box Inc. will need to hire an additional part-time cashier at $600 a
month which will be classified as a fixed-cost attributable to the X toy. Also, they have offered a $1
sales commission per toy to their floor sales representative. They will also include a package of
trading cards with every purchase of an X toy, which will cost them an additional $2 each.

Req ...Read More uired:
1. To make the project worthwhile, Toy Box Inc. would require a $5,000 profit per month. What level
of sales in units and in dollars would be required to reach this target profit? Show all
computations.
2. Assume that the venture is undertaken and an order is placed for 100 X toys. What would be Toy
Box%u2019s break-even point in units and in sales dollars? Show computations and explain the
reasoning behind your answer. You can ignore the fixed cost of $600 for this part. ...Read Less

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