Chips home brew whiskey management forecasts that if the

Assignment Help Corporate Finance

Reference no: EM13381798

Chip's Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for $20, then the demand for the product will be 15,000 bottles per year, whereas sales will be 85 percent as high if the price is raised 14 percent. Chip's variable cost per bottle is $10, and the total fixed cash cost for the year is $100,000. Depreciation and amortization charges are $20,000, and the firm has a 30 percent marginal tax rate. Management anticipates an increased working capital need of $3,000 for the year. What will be the effect of the price increase on the firm's FCF for the year?(Round answers to nearest whole dollar, e.g. 5,275.)

Reference no: EM13381798

Questions Cloud

First republic bancorp is considering the acquisition of a : first republic bancorp is considering the acquisition of a new data processing and management information system. the

Analyze the strengths and weaknesses of the coca cola : analyze the strengths and weaknesses of the coca cola company using ratio analysis and present your findings in a paper

Woidtke manufacturings stock currently sells for 22 a share : woidtke manufacturings stock currently sells for 22 a share. the stock just paid a dividend of 1.20 a share i.e. d0

Takes place at dates t 0 1 2 3 t 0 denotes the present : takes place at dates t 0 1 2 3. t 0 denotes the present date.the interest rate is assumed to be zero and trading1.

Chips home brew whiskey management forecasts that if the : chips home brew whiskey management forecasts that if the firm sells each bottle of snake-bite for 20 then the demand

Your organization is a manufacturing company with employees : your organization is a manufacturing company with employees in the following provincesnewfoundland and labradornova

Research and analyze the global equity and bond markets to : research and analyze the global equity and bond markets to create an faq sheet that could be given to prospective

Your grandparents have been left a substantial amount of : your grandparents have been left a substantial amount of money and want to invest in a company. your grandfather trusts

A senior financial analyst with ace gadgets ag is : a senior financial analyst with ace gadgets ag is attempting to get a better grasp on sales forecasting for ags new

User Account

All Pages