MBA FBX5010 Assessment2 1.docx MBA-FBX 5010 Assessment 2: Product Pricing Recommendat

MBA FBX5010   Assessment2 1.docx  MBA-FBX 5010   Assessment 2: Product Pricing Recommendation  MBA-FBX 5010   Accounting Methods for Leaders   Acme Pickle Corporation  The Acme Pickle Corporation, based in Jacksonville, FL, has distributed pickles under the  œFlorida™s  Best  brand  for eight  years. The  company normally  produces  between  8,000 and  10,000 cases of pickles a month and has the capacity to produce 12,000 cases without adding equipment or personnel.  The owner of a twenty-store  supermarket  chain in Wisconsin, called Super Deals, visits friends in Florida and is impressed with the quality of "Florida's Best" pickles. He approaches you, an Acme Pickle account manager, with an offer to buy 2,000 cases of pickles to use in a special promotion at his stores. He is thinking of something such as:  "Free jar of Florida's Best pickles with every purchase of forty dollars or more”this month only!"  He offers Acme a price of $9.50 per case, knowing that it is a very substantial discount from the normal selling price of $20 a case. Acme's management  is inclined  to turn  the  offer down, because their cost is calculated at $10.00 a case. They believe they would lose money if they sold at $9.50 a case. You, on the other hand, believe that some errors have been made in the cost accounting.  Goal: Suggest a different way of calculating the pricing of the pickles that may be lower while addressing  variable and fixed production costs, the benefit of recalculating the cost of pickle production and how  fi