Problem information: Puffy Pillow Company sells pillows for $25.00 each. The manufacturing cost, all variable, is $10 per pillow. The company is planning on renting an exhibition booth for both display and selling purposes at the annual crafts and art convention. The convention coordinator allows three rental options for each participating company. They are: Option 1. paying a fixed booth fee of $5,010 a month, or Option 2. paying an $4,000 fee plus 10% of revenue made at the convention, or Option 3. paying 20% of revenue made at the convention. Required: 1. Calculate the contribution margin per unit for each of the three options. 2. Compute the breakeven sales (dollars and units) and the monthly rent at break-even for each of the three options. 3. Calculate the degree of operating leverage at sale of 350 units for each of the three rental options. 4. At what level of revenues will Puffy Pillow Company earn the same operating income under option 1 and option 2

Northern lights electronics just completed plans to distribute its new tablet. the product has several unique features that differentiate it from competitor products. the marketing team plans to begin a roll-out with to only one traditional retailer for the first two months. this strategy will give consumers the perception of the product’s stand-out personality and increase demand. marketing will proceed with for the next four months, where it plans to distribute to three other retailers, as well. for the last six months of the year, it will initiate distribution agreements with discount retailers and online retailers, and any other electronics store that wants to carry it. the marketing team is confident that the tablet will cycle through the first three stages of its product life cycle quickly. as the tablet reaches maturity during the second half of its first year in the market, it is good strategy to proceed with as described above. intensive distribution; selective distribution; exclusive distribution exclusive distribution; selective distribution; intensive distribution tertiary level distribution; secondary level distribution; mono-level distribution mono-level distribution; secondary level distribution; tertiary level distribution