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Roxor Case Study Computation

The document presents information and decisions for Roxor Watch Company regarding 4 products - Q, M, N, and R. It includes details on target markets, pricing, promotion, and distribution strategies for each product. Financial projections are provided for expected sales, costs, and profitability. The company is analyzing pricing and product mix options to determine how to maximize contribution margin and profitability. Key decisions involve selecting optimal pricing and product portfolio to meet financial targets.

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Akun korea
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202 views4 pages

Roxor Case Study Computation

The document presents information and decisions for Roxor Watch Company regarding 4 products - Q, M, N, and R. It includes details on target markets, pricing, promotion, and distribution strategies for each product. Financial projections are provided for expected sales, costs, and profitability. The company is analyzing pricing and product mix options to determine how to maximize contribution margin and profitability. Key decisions involve selecting optimal pricing and product portfolio to meet financial targets.

Uploaded by

Akun korea
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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ROXOR WATCH COMPANY PTY LTD

Case Study

Decisions required # 1.
Product Code Target Market Price Promotion Distribution
Q General Public Cost + Pricing TV Ad Stores
M Students & ProfessionCost + Pricing Brochures Distribution
N Athletes Cost + Pricing Brochures Distribution
R General Public Skimming Price TV Ad Stores

Decisions required # 2.
Projected Sales
Exp. Price
Realizable 1983
Product Type Exp. Value S.D
Value
B 5,700.00 200.00 5,500.00 26.00
C 1,600.00 68.00 1,532.00 28.00
D 10,000.00 575.00 9,425.00 40.00
Q 6,000.00 1,400.00 4,600.00 50.00
R 4,000.00 140.00 3,860.00 25.00

Product Option Price Demand Deviation


A 80.00 2,400.00 600.00
Q B 50.00 6,000.00 1,400.00
C 45.00 7,900.00 2,050.00
A 20.00 5,500.00 200.00
R B 22.00 5,200.00 190.00
C 25.00 4,000.00 140.00

PRODUCTS
Items Total
D Q R
Revenue 400,000.00 300,000.00 100,000.00 800,000.00
Variable Production Cost (226,000.00) (102,000.00) (24,000.00) (352,000.00)
Product Contribution 174,000.00 198,000.00 76,000.00 448,000.00
Segment Variable Cost
Transportation (64,000.00)
Paper (2,160.00)
Commission (32,000.00)
Debtor (15,000.00) (113,160.00)
Net Contribution Margin 334,840.00
Fixed Cost (210,000.00)
Promotional Cost (115,000.00)
Segment Contribution Margin 9,840.00

PRODUCTS
Items Total
D Q
Incremental Revenue (40,000.00) 100,000.00 60,000.00
Variable Production Cost 22,600.00 (34,000.00) (11,400.00)
Product Contribution (17,400.00) 66,000.00 48,600.00
Segment Variable Cost
Transportation (1,600.00)
Paper (120.00)
Commission (2,400.00) (4,120.00)
Net Contribution Margin 44,480.00
Fixed Cost -
Incremental Promotional Cost (5,000.00)
Segment Contribution Margin 39,480.00

PRODUCTS
Items Total
D Q R
Revenue 400,000.00 300,000.00 100,000.00 800,000.00
Variable Production Cost (226,000.00) (102,000.00) (24,000.00) (352,000.00)
Product Contribution 174,000.00 198,000.00 76,000.00 448,000.00
Segment Variable Cost
Transportation (64,000.00)
Paper (2,160.00)
Commission (32,000.00)
Debtor (15,000.00)
Net Contribution Margin 334,840.00
Fixed Cost (210,000.00)
Promotional Cost (115,000.00)
Segment Contribution Margin 9,840.00
Product Cost
Total Variable Addition Contribution Contribution
Total Ranking Product Mix
Cost al Margin Margin
19.21 19.21 6.79 37,345.00 2 5,500.00
20.34 20.34 7.66 11,735.12 5 -
22.60 22.60 17.40 163,995.00 1 9,425.00
17.00 30 47.00 3.00 13,800.00 4 2,215.00
6.00 14 20.00 5.00 19,300.00 3 3,860.00

Realizable Comment
1,800.00 X lower margin compare to option B
4,600.00 ✓
5,850.00 X Cost is higher that revenue
5,300.00 X Cost is higher that revenue
5,010.00 X lower margin compare to option B
3,860.00 ✓
Comment

Controllable
Controllable

Controllable
Controllable
Controllable
Controllable

Uncontrollable
Controllable

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