Answer Happy

Currently, Econnect Computer Store has an official dealer for two different types of computer brands and the expenses associated with the brands are provided in TABLE 5. However, the management is planning to get one more dealership for FUAWEI. As a finance executive of the store, you are required to suggest to the management whether FAUWEI should be added or not. The estimated sales revenue and expenses also provided in the table below. TABLE 5 AXER (RM) SAMSONG (RM) FUAWEI (RM) Total Revenue 47,500.00 21,350.00 17,450.00 Cost of Good Sold (Variable Cost) 41,000.00 17,750.00 13,550.00 Contribution Margin 6,500.00 3,600.00 3,900.00 Fixed: Rental 2,500.00 1,500.00 1,500.00 Fixed: Salary 1,800.00 1,800.00 1,800.00 Fixed: Marketing and Admin 200.00 200.00 200.00 Operating Profit/Loss 2,000.00 100.00 400.00 Note: Econnect Computer Store has to rent more space to display the FUAWEI computer and also recruit a new Sale Assistant for the FUAWEI computer.