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Question 1 (10 points) Executives of Lubin Records produced the latest compact disc by The Markovitz Trio titled Harvey's greatest Hits. You are the product manager. You are faced with a profitability and launching issue and wondered if you should proceed. Here are your assumptions: CD package and disc costs $2.35 /CD Songwriter's royalty $1.00/CD Royalties paid to Artists $2.00/CD Advertising and Promotion Costs! $500,000 Studio recording costs $300,000 Retail Selling Price of CD $22.00 Margin required by Retailers 40% Margin required by Wholesalers 20% Calculate: 1. What is the profit required by Retailer's per unit? AM Question 2 (10 points) 1. What is the retailer's cost of sale? A/ Question 3 (10 points) 3. What is the wholesaler's selling price to the retailer? A/ Question 4 (10 points) 4. What profit dollar does the wholesaler make? A Question 5 (10 points) 5. What is the cost of sale for the wholesaler? Question 6 (10 points) 6. What is Lubin Record's selling price to the wholesaler? A Question 7 (10 points) 7. What is the variable cost of Lubin's sale? Question 8 (10 points) 8. What is the variable profit or contribution per CD for Lubin? A/ Question 9 (10 points) 9. What is the Contribution margin per CD for Lubin? Question 10 (10 points) 10. What are the total fixed costs for Lubin? A/ Question 11 (10 points) 11. Breakeven Unit Sales required by Lubin? A Question 12 (10 points) 12. If the total market for CD's was 350,000,000 units, what share of market would Lubin need to breakeven? A/ Question 13 (10 points) 13. Breakeven Dollar Sales by Lubin? A/ Question 14 (10 points) 14. If Lubin sold One Million records, what is the contribution Profit for Lubin? A Question 15 (10 points) 15. How much would Lubin need to sell in dollars to cover every $1 additional investment in advertising? Question 16 (10 points) 16. If Lubin wanted to make $500,000 in profit, how many records would Lubin need to sell? Question 17 (10 points) 17. If Lubin wanted to make $500,000 in profit, how much in dollars would Lubin need to sell? Question 18 (10 points) 18. If Lubin wanted to make 10% profit, how many units would Lubin need to sell? AM Question 19 (10 points) 19. If Lubin wanted to make 10% in profit, how many dollars in sales would Lubin have to do? Question 20 (10 points) 20. If Lubin invested $500,000 in promoting the CD album, what is the Breakeven dollar sales needed by Lubin

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