Deck 1: Market Based Management

Question 1

Javier's Pizza Point has a margin per unit of $2.00 for a typical pizza, total fixed expenses of $10,000, and average variable costs of $3.00 per pizza. How many pizzas must Javier sell to break even?

A) 2,000
B) 3,334
C) 5,000
D) 20,000
E) 30,000

Answer 1

5,000

Question 2

Calculate a business's return on sales when it makes a net profit of $500,000 from sales of $3 million.

A) 60%
B) 16.7%
C) 30.5%
D) 50.5%
E) 24.8%

Answer 2

16.7%

Question 3

MVB Inc.obtains a return of 9.8% from assets worth $248.5 million. Calculate its net profit.

A) $105.9 million
B) $36.8 million
C) $24.3 million
D) $76.2 million
E) $60.4 million

Answer 3

$24.3 million

Question 4

Milton-Normand Inc. obtains a return of 13.5% from total invested capital of $790.6 million. Calculate the net profit it generates.

A) $325.3 million
B) $159 million
C) $84.7 million
D) $233.5 million
E) $106.7 million

Question 5

Calculate the total marketing and sales expenses incurred by a business if it produces 30,000 units at $15 per unit and its net marketing contribution is $225,000.

A) $300,000
B) $150,000
C) $625,000
D) $225,000
E) $450,000

Question 6

Calculate the total volume of units sold by a business if there is a market demand of 550,000 units and the business has a market share of 25%.

A) 292,560
B) 440,650
C) 137,500
D) 325,000
E) 110,190

Question 7

Calculate the total market demand if a business sells 48,000 units, which represents a market share of 32%.

A) 224,500
B) 265,000
C) 196,000
D) 150,000
E) 125,300

Question 8

Calculate the marketing expense variance, if the actual marketing expense and marketing expenses estimated in the plan are $98,000 and $80,000, respectively. The actual percentage of sales is 15%.

A) $27,000
B) $1,800
C) $2,700
D) $18,000
E) $270,000