An internal financial report from the CFO E-Design's sales and design divisions have performed with remarkable consistency over the past three years. In each of those years, operational costs for the design division have accounted for roughly 55 percent of fixed costs and 25 percent of variable costs while the sales division has accounted for 30 percent of fixed costs and 60 percent of variable costs.The flowchart demonstrates the process in which the design and sales divisions play a key role. It is true that these divisions have had consistently proportional operational costs, but, as evidenced by the attached flowchart, the sales division is responsible for more than 50% of EDesign's sales and delivery process. It is my position that the sales division should thus be charged with more than 50% of associated costs, with a lower percentage attributed to the design division.https://gmatclub.com/forum/download/file.php?mode=view&id=79045 In the flowchart above, each rectangle represents a step in a product’s development that requires 6 employees and each diamond represents a step that requires 2 employees. Each step is handled by a different committee. No employees are on multiple committees. Flowchart Sales.jpg

1. We are given the argument by the VP of Design: "It is my position that the sales division should thus be charged with more than 50% of associated costs, with a lower percentage attributed to the design division" . Now it's asked to find the statement that best supports the argument . 2. Note that this argument is based on the fact that the sales division does more steps and therefore should be charged with more than 50% of associated costs. This is under the assumption that more steps means more costs associated . 3. Performance levels for the sales and design division have varied over the past three years. This is irrelevant because performance levels have no connection to costs. So, this statement doesn't support the argument best. 4. All of the products offered by the sales division are produced entirely by the design team. Here, this statement would still be irrelevant because it has no connection to costs. So, this statement doesn't support the argument best. 5. Most sales division activities cost up to twice as much as most design division activities. The key word is "most". That means there could be a design division activity that has a cost so high that overweighs all other costs and would weaken the argument. So, this statement doesn't support the argument best. 6. Each step performed by the sales division carries the same cost as each step performed by the design division. Since the sales division does more steps, that means they carry a higher cost overall than the design division. So, this statement does support the argument best. 7. Total costs for each of the sales and design divisions have remained roughly constant. Here, this statement is irrelevant because we're looking at the cost percentages which are relative. So, this statement doesn't support the argument best.

Hi, Isn't the argument as well linked with more than 50% increase in sales by the sales and delivery team??

Prejitha Understanding the VP of Design's Argument: The VP of Design makes a specific claim: - The sales division handles more than 50% of the sales and delivery process (based on the flowchart) - Therefore, sales should be charged with more than 50% of associated costs - This means design should get a lower percentage of costs attributed to them Analyzing the Flowchart Evidence: Let me count the steps each division performs: Sales Division: - Rectangles (6 employees each): 3 steps - Diamonds (2employees each): 3 steps - Total: 6 steps out of 8 total steps = 75\% of the process Design Division: - Rectangles ( 6 employees each): 1 step - Diamonds ( 2 employees each): 1 step - Total: 2 steps out of 8 total steps = 25\% of the process Why Option D Strengthens the Argument: Option D states: "Each step performed by the sales division carries the same cost as each step performed by the design division." This is crucial because: If each step costs the same amount regardless of which division performs it And Sales performs 75\% of the steps (6 out of 8) Then Sales should logically bear 75\% of the total costs This directly supports the VP's claim that Sales should be charged with more than 50\% of costs The equal cost per step creates a direct proportional relationship between workload and cost allocation, making the VP's argument mathematically justified. Why Other Options Don't Strengthen as Much: Option A: Varying performance levels actually contradicts the CFO's statement about "remarkable consistency" Option B: If design produces all products, this would actually weaken the VP's argument by suggesting design does more work than shown Option C: While this shows sales activities are expensive, it doesn't create the clear proportional logic that option D provides Option E: Constant total costs is neutral information - doesn't help justify changing the allocation Key Takeaway: Option D strengthens the argument by establishing that cost allocation should match process responsibility. Since Sales handles 75\% of the process steps, and each step costs the same, they should bear 75\% of costs - strongly supporting the VP's position that Sales should be charged with "more than 50\% " of costs.

E-Design's sales and design divisions have performed with remarkable : Multi-Source Reasoning (MSR)

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Hi could you pls explain the answer like justify it

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Prejitha

Hi could you pls explain the answer like justify it

Prejitha Understanding the VP of Design's Argument:

The VP of Design makes a specific claim:
- The sales division handles more than 50% of the sales and delivery process (based on the flowchart)
- Therefore, sales should be charged with more than 50% of associated costs
- This means design should get a lower percentage of costs attributed to them

Analyzing the Flowchart Evidence:

Let me count the steps each division performs:

Sales Division:
- Rectangles (6 employees each): 3 steps
- Diamonds (2employees each): 3 steps
- Total: \(6\) steps out of \(8\) total steps = \(75\%\) of the process

Design Division:
- Rectangles (\(6\) employees each): \(1\) step
- Diamonds (\(2\) employees each): \(1\) step
- Total: \(2\) steps out of \(8\) total steps = \(25\%\) of the process

Why Option D Strengthens the Argument:

Option D states: "Each step performed by the sales division carries the same cost as each step performed by the design division."

This is crucial because:

If each step costs the same amount regardless of which division performs it
And Sales performs \(75\%\) of the steps (6 out of 8)
Then Sales should logically bear \(75\%\) of the total costs
This directly supports the VP's claim that Sales should be charged with more than \(50\%\) of costs

The equal cost per step creates a direct proportional relationship between workload and cost allocation, making the VP's argument mathematically justified.

Why Other Options Don't Strengthen as Much:

Option A: Varying performance levels actually contradicts the CFO's statement about "remarkable consistency"

Option B: If design produces all products, this would actually weaken the VP's argument by suggesting design does more work than shown

Option C: While this shows sales activities are expensive, it doesn't create the clear proportional logic that option D provides

Option E: Constant total costs is neutral information - doesn't help justify changing the allocation

Key Takeaway:
Option D strengthens the argument by establishing that cost allocation should match process responsibility. Since Sales handles \(75\%\) of the process steps, and each step costs the same, they should bear \(75\%\) of costs - strongly supporting the VP's position that Sales should be charged with "more than \(50\%\)" of costs.

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	Performance levels for the sales and design division have varied over the past three years.
	All of the products offered by the sales division are produced entirely by the design team.
	Most sales division activities cost up to twice as much as most design division activities.
	Each step performed by the sales division carries the same cost as each step performed by the design division.
	Total costs for each of the sales and design divisions have remained roughly constant.

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E-Design's sales and design divisions have performed with remarkable

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