Outdoor Gear Co. manufactures and sells 6 different models of camping gear. Outdoor Gear is...
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Outdoor Gear Co. manufactures and sells 6 different models of camping gear. Outdoor Gear is contemplating a 3% price cut for all models. It expects the price cut to result in an 8% increase in units sold for models C301, C303, and C305. The other three models (C302, C304, and C306) are expected to see a 4% increase in sales volume. Assess the impact of the price cut on Outdoor Gear’s profits and prepare the equity statement. •Model: C301 oSales Price: $100 oVariable Costs: $50 oSales Volume: 2,500 •Model: C302 oSales Price: $110 oVariable Costs: $55 oSales Volume: 3,000 •Model: C303 oSales Price: $120 oVariable Costs: $60 oSales Volume: 3,500 •Model: C304 oSales Price: $130 oVariable Costs: $65 oSales Volume: 4,000 •Model: C305 oSales Price: $140 oVariable Costs: $70 oSales Volume: 2,800 •Model: C306 oSales Price: $150 oVariable Costs: $75 oSales Volume: 2,200
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