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Please read each passage below

Please read each passage below

Please read each passage below, I need a few sentences in response to each part. Please use at least one source. Please cite the reference(s) properly. Part 1 and 2 PLACE THE REFERENCES UNDERNEATH EACH PASSAGE can be on the same page, however, please keep them separate by labeling them Part 1 and Part 2. No Title Page Needed DUE TOMORROW 2/21/22 by 6PM CST

PART 1 

In the text it says that there are two possible reasons for sales to decrease; fewer products being sold or greater number of discounts being offered. (Epstein, 2014) In other words, sales will increase or decrease depending on if more units or less units are being sold. It will also increase or decrease depending on if the price of units being sold increases or decreases. This also links to changes one might see in gross profit. Changes in sales price, cost of products being sold, and the volume of products being sold all influence the increase or decrease of gross profit.  If the sales price or volume of products being sold decreases then the gross profit will decrease. If the price of products increases, the volume of sales increases or the cost of product decreases, then gross profit could increase. Another influencer on gross profit is the cost to operate or operating cost. If the price of operating costs increases then gross profit may decrease. If the operating costs decreases the gross profit may increase.

References

Epstein, L. (2014). Financial Decision Making: An Introduction to Financial Reports. Bridgepoint Education, Inc.

PART 2

One of the causes for the decrease in the number of sales are the price increases. Prices for all kinds of goods and services go up in the United States all the time. In some cases, it is due to inflation and in other cases there is imbalance of supply and demand. For example, if the consumer demand for a product is on the rise, the company that supplies that product realizes that they can charge more. As the prices go up so does the demand in employment wages in order to keep pace. Employment wage is another cause in decreasing sales number. As the company expands into greater numbers in terms of employment and salary increases, so does the value in the product in which the company invests in promoting.

While on the topic of salary increases, it does not always suggest an increase in sales. A company can apply it towards the increase in gross profit instead. For example, increasing throughput and utilizations are other ways to increase gross profit. In terms of manufacturing, improving throughput and utilization can lead to greater efficiency for the product. Thereby leading to a higher gross profit. If the company were to share a percentage of that gross profit with the employees, then this increase could lead to more motivation among the employees to improve the production in the workplace. In short terms, better throughput can lead to higher wage and then can lead to higher efficiency in manufacturing the product.

Reference

Epstein, L. (2014). Financial decision making: An introduction to financial reports. Zovio. https://content.uagc.edu/


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