Assume that total revenue can increase

Assignment Help Financial Management

Reference no: EM131929497

A project has expected sales of 6,000 units, a selling price of $29 a unit, variable costs equal to 60% of sales, fixed costs of $32,000, and depreciation of $9,500. Assume that total revenue can increase by 12%, variable costs can decrease to 58% of sales, and fixed costs can decrease by 5% in an optimistic situation. What would the pretax profits be, per year, if the optimistic situation should occur? Show your computations.

Reference no: EM131929497

Questions Cloud

What is the fixed-cost expenditure for firm : What is the fixed-cost expenditure for a firm with a DOL of 4.5 that generates pretax profits of $1 million and has $600,000 in depreciation expense?

What is the real rate of return on investment : What is the real rate of return on this investment if inflation averages 6% annually during the period?

Market and book ratio-what is its p-e ratio : A company has an EPS of $3.45, a book value per share of $37.26, and a market/book ratio of 1.8x. What is its P/E ratio?

Discuss public health significance of the research question : What do you think the public health significance of the research question in this study was? Is it mostly of local significance or is there a global impact?

Assume that total revenue can increase : Assume that total revenue can increase by 12%, variable costs can decrease to 58% of sales, and fixed costs can decrease by 5% in an optimistic situation.

Find the interest rate needed for the sinking fund : Find the interest rate needed for the sinking fund to reach the required amount. Assume that the compounding period is the same as the payment period.

Explain the effects of the movements on gender : Write a 700-1000 word paper to explain the effects of those movements on gender. Address the following questions. Provide an Introduction and conclusion.

Estimate that the average daily loss : A Rollercoaster's auditors estimate that the average daily loss from those illegally riding without tickets is never more than $200.

How much in current liabilities should office depot pay off : How much in current liabilities should Office Depot pay off within the next week to achieve its goal

User Account

All Pages