Application Exercises
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MGS 3040 SEC. 04 CHAPTER # 3 PAGE # 87 QUESTION 1 Application Exercises Group Members: Michelle Barborino Abbas Kazmi Jihua liu Brenden Luuney Betty Myhand
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Application Exercises. MGS 3040 Sec. 04 Chapter # 3 Page # 87 Question 1. Group Members: Michelle Barborino Abbas Kazmi Jihua liu Brenden Luuney Betty Myhand. Make the first two rows of your spreadsheet similar that in Figure 3-7 (Pg. 87). Place the current date so that it is centered. - PowerPoint PPT Presentation
Transcript of Application Exercises
MGS 3040 SEC. 04
CHAPTER # 3
PAGE # 87
QUESTION 1
Application Exercises
Group Members:Michelle BarborinoAbbas KazmiJihua liuBrenden LuuneyBetty Myhand
Make the first two rows of your spreadsheet similar that in Figure 3-7 (Pg.
87)
Resort Bicycle Rental
Bicycle Inventory Valuation
Group ‘C’ Presentation - Bicycle Rental (Page 87 Quest. 1)
Place the current date so that it is centered
Resort Bicycle Rental
Bicycle Inventory Valuation
Thursday, February 11, 2010
Group ‘C’ Presentation - Bicycle Rental (Page 87 Quest. 1)
Use the formulas for Calculations
Resort Bicycle Rental
Bicycle Inventory Valuation
Thursday, February 11, 2010
Make of Bike Bike CostNumber on
HandCost of Current
InventoryNumber of
RentalsTotal Rental
RevenuesRevenue per Bike
Revenue as percent of Cost of Inventory
Wonder Bike $325 12 $3,900 85 $6,375 $531 163.5%
Wonder Bike II $385 4 $1,540 34 $4,570 $1,143 296.8%
Wonder Bike Supreme $475 8 $3,800 44 $5,200 $650 136.8%
LiteLift Pro $655 8 $5,240 25 $2,480 $310 47.3%
LiteLift Ladies $655 4 $2,620 40 $6,710 $1,678 256.1%
LiteLift Racer $795 3 $2,385 37 $5,900 $1,967 247.4%
Group ‘C’ Presentation - Bicycle Rental (Page 87 Quest. 1)
Three Examples of decisions that management can make using this data.
Management can increase the number of “Wonder Bike II” bicycles because of its high revenue as percent of cost of inventory.
Management can reduce the number of “LiteLift Pro” bicycles because of its low revenue as percent of cost of inventory.
Management can consider replacing “LiteLift Pro” with “Wonder Bike Supreme” of with “Wonder Bike” because of their demand.
Wonder Bike II $385 4 $1,540 34 $4,570 $1,143 296.8%
LiteLift Pro $655 8 $5,240 25 $2,480 $310 47.3%
Group ‘C’ Presentation - Bicycle Rental (Page 87 Quest. 1)
Use the formulas for Calculations
Resort Bicycle Rental Updated Spread Sheet As Suggested
Bicycle Inventory Valuation
Thursday, February 11, 2010
Make of Bike Bike CostNumber on
HandCost of Current
InventoryNumber of
RentalsTotal Rental
RevenuesRevenue per Bike
Revenue as percent of Cost of Inventory
Wonder Bike $325 12 $3,900 85 $6,375 $531 163.5%
Wonder Bike II $385 5 $1,920 34 $4,570 9140 238.0%
Wonder Bike Supreme $475 8 $3,800 44 $5,200 $650 136.8%
LiteLift Pro $655 5 $3275 25 $2,480 $496 75.7%
LiteLift Ladies $655 4 $2,620 40 $6,710 $1,678 256.1%
LiteLift Racer $795 3 $2,385 37 $5,900 $1,967 247.4%
Group ‘C’ Presentation - Bicycle Rental (Page 87 Quest. 1)
Other Useful Calculations
Make of Bike Bike CostNumber on
Hand
Cost of Current
Inventory
Number of
Rentals
Total Rental
RevenuesRevenue per Bike
Revenue as percent of Cost of Inventory
Profit Per Bike
Wonder Bike $325 12 $3,900 85 $6,375 $531 163.50% $ 206
Wonder Bike II $385 4 $1,540 34 $4,570 $1,143 296.80% $ 758
Wonder Bike Supreme $475 8 $3,800 44 $5,200 $650 136.80% $ 175
LiteLift Pro $655 8 $5,240 25 $2,480 $310 47.30% $ (345)
LiteLift Ladies $655 4 $2,620 40 $6,710 $1,678 256.10% $ 1,023
LiteLift Racer $795 3 $2,385 37 $5,900 $1,967 247.40% $ 1,172
We added the “Profit Per Bike” Column. This shows how much net profit the store earns per bike. We found this out by taking the revenue per bike and subtracting the cost of the inventory. After that, we divided that by the number on hand.
