Identifying the Cost Structure and Projecting Gross Margins for Capital-Intensive, Cyclical Businesses.

 Prompt: First, review the Module Six resources. Then revisit Chapter 10 in the textbook, which was assigned in Module Three. For this practice activity, we will use the End of Chapter exercise from pp. 703–704: “10.11 Identifying the Cost Structure and Projecting Gross Margins for Capital-Intensive, Cyclical Businesses.” This includes the AK Steel case study. After reading the case study, answer the questions below in the Module Six Activity Worksheet. Refer to the textbook and other course materials to support your responses. 

A. Cost Structure: Compute the cost structure for each firm. You will need to calculate three variables for both companies: 
1. Variable Cost per Dollar of Sales = Change in Cost of Products Sold / Change in Sales 
2. Total Variable Cost = Variable Cost per Dollar of Sales * Sales 
3. Total Fixed Cost = Total Cost of Product Sold – Total Variable Cost 

Don't use plagiarized sources. Get Your Custom Essay on
Identifying the Cost Structure and Projecting Gross Margins for Capital-Intensive, Cyclical Businesses.
Just from $13/Page
Order Essay

B. Structure of Manufacturing Cost: In one paragraph, compare the structure of manufacturing costs for each firm. 

C. Projected Financial Information: Compute the projected sales, cost of products sold, gross profit, and gross margin (gross profit as a percentage of sales) of each firm for Year +1 through Year +5. Using the table in the Module Six Activity Worksheet is recommended. 

D. Gross Margin Comparison: In one to two paragraphs, explain why the levels and variability of the gross margin percentages differ for these two firms for Year +1 through Year +5. Provide an example comparing the effect of the change in gross margin. (For example, if gross margin changed from 25% to 35%, what would it mean for each company?) 

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Order your essay today and save 15% with the discount code SKYLINE