Problem 1:

The boot department of the Great Western Outfitters store is preparing to set sales goals for the upcoming year. Sally Brown, the department manager, is trying to determine what brands of boots to retain as part of the sales inventory. In particular, she is wondering about the value of continuing to sell Durango Boots. Going through past records, she retrieves the following information about the sales of Durango boots and asks you to help her with some calculations:

Based on the above information:

• Compute the Contribution Margin (CM), unit CM, and CM ratio. IN order to earn full credit for your work, please remember to include detailed step by step calculations with your response.

CM = S – VC = $500,000 – 300,000 = $200,000

Unit CM = p – v = ($500,000 / 1,000) – ($300,000 / 1,000) = ($5-$3) = $2

CM Ratio = CM / S =

• If the average CM ratio for other brands is 35%, should Brown keep stocking Durango Boots? Why or Why not? Provide a rationale that demonstrates your understanding of how the technique is applied in practice.

Problem 2:

Sally Brown discovers that the owner of Great Western Outfitters is a big fan of Durango Boots and wants to continue selling them. As Sally prepares to order the boots for next year, she needs to determine how many pairs of boots (a pair of boots is one unit) she needs to sell to break even.

Based on the Table from Problem 1:

• Help Sally compute the break-even point in units and in dollars.

Break-even point in units = FC / Unit CM = $150,000 / $200 = ??? units

Break-even point in dollars = FC / CM ratio (from problem 1) = ???

• What if any factors might she consider which have the potential to change her analysis and/or the assumptions underlying her analysis?

Problem 3: Sally feels strongly that if they are going to carry Durango Boots that they need to do more than just break even.

Based on the Table from Problem 1:

• How many pairs of boots (units) would the boot department need to sell to obtain a profit of $100,000?

• How many pairs of boots (units) would the company have to sell to obtain an after tax income of $120,000?

First Bullet Point: Target income volume = (FC + target Income) / Unit CM = ($150,000 + $100,000) / $200 = ??? units

Second Bullet Point: Target income volume = (FC + [Target after tax income / (1 – tax rate)] / Unit CM = ??? units

• What assumptions were essential to the accuracy of her results and to the analysis and conclusions drawn? Discuss what role HR data might play in arriving at these calculations. How do HR data impact decisions on sales volume and operational results?

Problem 4:

Sally Brown is flipping through a popular magazine and sees a photo spread of Garth Brooks, the country singing legend. Prominently on display is his collection of Durango Boots. Because of this, Sally is certain that the store can expect to sell 250 extra pairs of boots.

Based on the Table from Problem 1:

• How much will income increase if the sales go up by 250 units? (You can ignore taxes for this problem.)

• How much will income increase if the store expects sales to go up by $25,000? (ignoring taxes).

First Bullet Point: Change in net income = change in unit sales x unit CM (page 51). Since CM per unit = $200, then 250 units x $200 = ???

Second Bullet Point: Change in net income = dollar change in sales x CM ratio (page 50). Change in net income = ???

Problem 5:

The top three selling brands of boots at the Great Western Outfitters store are Double-H boots, Durango boots, and Stetson boots.

For the last quarter, sales were as follows:

Total fixed costs were $507,000.

Using these figures:

• Determine the sales mix, CM by product and in total, the CM ratio by product and in total, and the net income (ignore taxes).

• Calculate the break-even point in dollars in total and by product.

• Use three decimal places for the percentages. For example, .275 would be 27.5%

• To help you get started on the chart below. (1) Using the first row of the chart for Sales, what percentage of the total $1,775,000 is A $400,000 ?

• $400,000 / $1,775,000 = xx.x%

• This xx.x% would be the Sales Mix percentage for A.

Break-even point in total dollars = 507,000 / .338 = ???

Break-even for the individual products =

A: $1,500,000 x SM-A% = ???

B: $1,500,000 x SM-B% = ???

C: $1,500,000 x SM-C% = ???

Total: $1,500,000

Problem 6:

Sally Brown is concerned about the sales numbers for Double-H Boots.

Based on the Table from Problem 5:

• What is the margin of safety if the company projects sales at $400,000 and the break-even point is $250,000?

(400,000 – 250,000) / $400,000 = ?%

• As the HR Manager for several stores, variable and fixed costs include HR components. As an HR professional, having reviewed the analysis, what feedback do you have about the information from an HR perspective? How might this information be valuable to your role in hiring, rewarding and developing sales associates?

Mad Libs

I’m not sure if any of you remember of have ever played Mad Libs (Links to an external site.). It’s a simple game. One person asks another to provide names, places, numbers, adjectives, and adverbs without knowing the context. Then those answers are filled in to make a story. It usually ends up being fairly silly.

I want you to create a Mad Libs game using the information from the lesson. There are a few requirements.

• The story must be printed out to the console.
• You must ask for a minimum of six (6) pieces of information.
• You must request at least three numbers add a number greater than one to each of them. What you decide to add is up to you but each value must be ADDED (not subtracted) to another number that is larger than one, and the results should be correct.
• Keep it safe for work. I’m going to have you post your work to the discussion forum and you’ll have to play the games your classmates create so keep it professional or you won’t get a passing grade.
• Submit both an HTML and JS file. I will start the program by opening the HTML file.
• After you are done, submit your work to the Canvas discussion board for this lesson.
• For extra credit use something from the Math class to perform a calculation to one of your numbers after you have done valid addition with it.

Note: This assignment has an extra credit component. To earn extra credit you must first earn a perfect score on the base requirements for the assignment.

Some general coding guidelines

• Throughout this class, prefer single vs double quotes around strings unless you have a good reason such as having single quotes in the string.
• Use camelCase style variable names rather than snake_case or kebob-case.
• Put a line break after every command.
• Comments are helpful. Don’t be afraid to use them.

Good example:

let myName = ‘Bob’;

// Capture the first letter of the name.

let firstInitial = myName[0];

Bad example:

let my_name = “Bob”; let first_initial = myName[0];

Mad Libs RubricMad Libs

RubricCriteriaRatingsPtsThis criterion is linked to a Learning OutcomeSix inputs captured5.0 ptsFull Marks0.0 ptsNo Marks5.0 ptsThis criterion is linked to a Learning OutcomeThree numbers captured with numeric data type9.0 ptsFull Marks0.0 ptsNo Marks9.0 ptsThis criterion is linked to a Learning OutcomeCaptured data used in story output.2.0 ptsFull Marks0.0 ptsNo Marks2.0 ptsThis criterion is linked to a Learning OutcomeProgram output and formatting2.0 ptsFull Marks0.0 ptsNo Marks2.0 ptsThis criterion is linked to a Learning OutcomeCode quality and cleanliness1.0 ptsFull Marks0.0 ptsNo Marks1.0 ptsThis criterion is linked to a Learning OutcomeFile naming conventions1.0 ptsFull Marks0.0 ptsNo Marks1.0 ptsThis criterion is linked to a Learning OutcomeExtra Credit – Math class method used.2.0 ptsFull Marks0.0 ptsNo Marks2.0 pts