Question

Winnebagel Corp. currently sells 24,600 motor homes per year at $36,900 each, and 9,840 luxury motor coaches per year at $69,700 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 15,580 of these campers per year at $9,840 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 3,690 units per year, and reduce the sales of its motor coaches by 738 units per year.

Answer 1

The amount to use as the annual sales figure when evaluating this project is $1,831,617,600.

Step-by-step explanation:

Note: This question is not complete as the requirement is not included. To complete question, the requirement is therefore provided before answering the question as follows:

Required: What is the amount to use as the annual sales figure when evaluating this project?

The explanation of the answers is now provided as follows:

New units of motor homes per year = Current units of motor homes per year + Expected increase in the unit of motor homes per year = 24,600 + 3,690 = 28,290

New units of luxury motor coaches per year = Current units of luxury motor coaches per year + Expected decrease in the unit of luxury motor coaches per year = 9,840 - 738 = 9,102

Annual sales figure = (New units of motor homes per year * Unit of motor homes) + (New units of luxury motor coaches per year * Unit price of luxury motor coaches) + (Expected units of portable camper * Unit price of portable camper) = (28,290 * $36,900) + (9,102 * $69,700) + (15,580 * $9,840) = $1,831,617,600

Therefore, the amount to use as the annual sales figure when evaluating this project is $1,831,617,600.