Paddleboard Incorporated Builds Three Products: River,Lake,and Ocean

question 37

Essay

Paddleboard Incorporated builds three products: River,Lake,and Ocean.Information for these three products is shown below:

Total annual fixed costs are $765,000.Assume the sales mix remains the same at all levels of sales.
Assume each scenario below is independent of the other.Unless stated otherwise,assume the variables are the same as in the base case.
(1)Prepare a contribution margin income statement for the base case.
(2)How will total profit change if the Lake sales price increases by 15 percent? (Compare your result with requirement 1 above. )
(3)Go back to the base case.How will total profit change if the River sales volume decreases by 2,000 units and the sales volume of other products remains the same? (Compare your result with requirement 1 above. )
(4)Go back to the base case.How will total profit change if fixed costs decrease by 10 percent? (Compare your result with requirement 1 above. )

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Definitions:

Filtering Mechanisms

The processes used to sift through information to retain only what is necessary or relevant, often to avoid overload or to focus on specific criteria.

Communication Barriers

Obstacles that impede the clear exchange of ideas and information between individuals or groups.

Messages

Discrete units of communication intended to convey information, emotions, or intentions.

Decoded

The process of interpreting or giving meaning to a message, ensuring understanding between the sender and the receiver.