Accounting homework help.
- What do you think is the proper role of metrics for marketers? How should we use metrics, and how do we decide which metrics are appropriate?
Answer half a page or less.
- Wally’s Widget World is an online retailer that makes and sells widgets. There are three models of widgets, each with its own cost of materials and labor.
| Model | Percent of sales | Materials cost | Labor cost | Selling price |
| Econowidget – base-level widget for the budget-conscious widget user | 35% | $3.50 | $1.50 | $6.99 |
| Superwidget – adds additional feature for the more demanding widget user | 45% | $4.00 | $1.75 | $8.99 |
| Widget Supreme – for the more discerning and sophisticated widget user | 20% | $5.25 | $2.00 | $11.99 |
The widgets are all the same size and approximate weight, so shipping costs for each widget (regardless of model) are $2.50, and customers are charged $3.99 per widget. Wally’s Widget World has monthly costs below:
Rent $10,000
Utilities 2,000
Administrative salaries 6,000
Overhead/supplies 1,000
In addition, Wally’s budgets $3,000 each month on banner ads and search-engine marketing. Assuming the percentage of sales for each product in the product line remains constant, perform the following analyses:
- Calculate the break-even volume
- Calculate the break-even revenue
- Wally’s Widget World has a monthly target profit of $5,000. What should be the target volume and revenue for this objective?
- Is this a viable target profit? Explain using your calculations. Give an example of another target profit that you think would work and explain why.
