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3. Compute the projected profit for the order quantities suggested by the management team under three scenarios: worst case in which sales equal 10,000 units, most likely case in which sales equal 20,000 units, and best case in which sales equal 30,000 units.
This is an indication that costs need to be under better control. Imagine a company has a net income of $15 million from sales of $100 million, giving it a profit margin of 15% ($15 million/$100 million). If in the next year net income rose to $20 million on sales of $200 million, its profit margin would fall to 10%.his is an indication that costs need to be under better control. Imagine a company has a net income of $15 million from sales of $100 million, giving it a profit margin of 15% ($15 million/$100 million). If in the next year net income rose to $20 million on sales of $200 million, its profit margin would fall to 10%.