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didnt cover in class so i need help on comprension homework problem, note: this is due in a week so there is plenty of time.

18(0complete) Requirements - X ations 1. Division A of Deisel, Inc. has $5,100,000 in assets. Its yearly fixed costs are $878,000, and the variable costs of its product line are $1.25 per unit. The division's volume is currently 520,000 units. Competitors offer a similar product, at the same quality, to retailers for $3.50 each. Deisel's management team wants to earn a 6% return on investment on the division's assets a. What is Division A's target full product cost? b. Given the division's current costs, will Division A be able to achieve its target profit? c. Assume Division A has identified ways to cut its variable costs to $1.10 per unit What is its new target fixed cost? Will this decrease in variable costs allow the division to achieve its target profit? d. Division A is considering an aggressive advertising campaign strategy to differentiate its product from its competitors. The division does not expect volume to be affected, but it hopes to gain more control over pricing If Division A has to spend $105,000 next year to advertise and its variable costs continue to be $1.10 per unit, what will its cost-plus price be? Do you think Division A will be able to sell its product at the cost-plus price? Why or why not? 8 str rs offer 2. The division manager of Division B received the following operating income data for the past year E(Click the icon to view the Division B operating income data) The manager of the division is surprised that the T205 product line is not profitable. The division accountant estimates that dropping the T205 product line will decrease fixed cost of goods sold by $82,000 and decrease fixed selling and administrative expenses by $11,000 Prepare a differential analysis to show whether Division B should drop the T205 product line b. What is your recommendation to the manager of Division B? 3. Division C also produces two product lines. Because the division can sell all of the product it can produce, Deisel is expanding the plant and needs to decide which product line to emphasize. To make this decision, the division accountant assembled the following data a. Print Done of 50 pts 1 of 1 (0 complete) P26-1 Data Table - X hents Deisel, ma agement t Division B of Deisel, Inc. of Deisel, Inc. h product line are ilar product, at t % return on inv erequirem Income Statement For the Year Ended December 31, 2018 ement 1. D to retailers s Division A's ta the division's CU Product Line at is Divisio T205 B179 Total e Division A has fixed cost? Will in A is considerin hpetitors. The div icing. If Division ue to be $1.10 pe product at the cc Net Sales Revenue 350,000 S 370,000 720,000 Cost of Goods Sold: full product Variable 39,000 47,000 86,000 Fixed 270,000 64,000 334,000 309,000 111,000 420,000 n manager of Diw the icon to view Total Cost of Goods Sold Gross Profit 41,000 259,000 300,000 ger of the division estimates that d hd decrease fixed e a differential an Selling and Administrative Expenses: Variable 61,000 74,000 135,000 56,000 29,000 85,000 Fixed s your recommen 117,000 103,000 220,000 also produces twc eisel is expanding on, the division acc Total Selling and Administrative Expenses $ (76,000) S 156,000 $ 80,000 Operating Income (Loss) se from any Print Done parts Clear All k: CH 25-26 Comprehensive Problem 1 of 1 (0 complete) milar to) Requirements ty stockholder and president of Deisel, In, is working with his top managers on sell its product at the cost-plus price? Why or why not? 2. The division manager of Divisaon B received the following operating income data for the past year (Cick the icon to view the Division B operating income data) The manager of the division is surprised that the T205 product line is not profitable The division accountant estimates that dropping the T205 product line will decrease fixed cost of goods sold by $82,000 and decrease fixed selling and administrative expenses by $11,000 a. Prepare a derential analysis to show whether Division B should drop the T205 product line. b. What is your recommendation to the manager of Division B? 3. Division C also produces two product lines. Because the division can sell all of the product it can produce, Deisel is expanding the plant and needs to decide which product line to emphasize To make this decision, the division accountant assembled the following data: (Click the icon to view the Division C product data) sion A of Deisel, Inc. has $5,100,000 in assets Its yearly fixed costs are $878.00 $3.50 each. Deisel's management team wants to earn a 6% return on investme A's target full product cost? X Data Table Per Unit Ater expansion, the factory will have a production capacity of 4,900 machine hours per month The plant can manufacture ether 24 units of K/07s or 65 units of G582s per machine hour a. Identify the constraining factor for Division C b. Prepare an analysis to show which product line to emphasize 4. Division D is considening two possible expansion plans Plan A would expand a current product line ata cost of $8,400,000 Expected annual net cash inflows are $1,600,000, with zero residual value at the end of 10 years Under Plan B, Division D would begin producing a new product at a cost of $8,300,000 This plan is expected to generate net cash inflows of $1,070,000 per year for 10 years, the estimated useful life of the product line Estmated residual value for Plan B is $1,300,000 Division D uses straight ine depreciation and requires an annual return of 10 % a. Compute the payback, the ARR, the NPV, and the profitability index for both plans Compute the estimated IRR of Plan A Use Excel to verity the NPV calculatons in Requirement 4(a) and the actual IRR for the hwo plans How does the IRR of each plan compare with the company's required rate of return? Division D must rank the plans and make a recommendation to Deser's top management team for the best plan Which expansion plan should Division D choose? Why? K707 G582 Sales pnice 90 S 46 Vaniable costs 21 25 69 $ 21 Contribution margin Contributon margin ratio 76 7% 45 7% Print Done b. c. d. y ist or enter any number in the input fiellds and then click Check Answer Print Done

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