Trish's Quilt Connection Is an On-Line Company Specializing in High-Quality

question 48

Multiple Choice

Trish's Quilt Connection is an on-line company specializing in high-quality quilt frames and accessories. Trish does not charge customers shipping charges for quilt frame orders. She has provided the following information; Using the high-low method, estimate Trish's total variable and fixed costs are at if she sells 1,280 frames:

• A) Total variable cost=$5,120; Total Fixed Cost $4,880
• B) Total variable cost=$320; Total Fixed Cost $9,680
• C) Total variable cost=$10,000; Total Fixed Cost $0
• D) Total variable cost=$2,000; Total Fixed Cost $8,000
• E) Total variable cost=$7,500; Total Fixed Cost $500

Learn how to assess and make decisions on whether to process further or sell products at the split-off point.

Understand how to perform break-even and profitability analysis under different pricing and cost scenarios.

Grasp the concept of the economic value to the customer and how this impacts pricing strategies.

Understand how target costing is used to manage product costs and pricing strategies effectively.

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Definitions:

Product Innovation

The development of new or significantly improved goods or services to meet consumer needs or open new markets.

Four Ps

A marketing model that identifies and optimizes the four key elements of marketing: Product, Price, Place, and Promotion.

Planning

The process of setting objectives, outlining strategies, and developing actions to achieve goals.

Long-Term Relationships

Enduring engagements or associations between individuals, groups, or companies, emphasizing mutual benefit, loyalty, and sustained interaction.