Compute fixed operating costs

Reference no: EM1359277

Rodney Rogers, a recent business school graduate, plans to open a wholesale dairy products firm. The business will be completely financed with equity. Rogers expects first year sales to total $5,500,000. He desires to earn a target pretax profit of $1,000,000 during his first year of operation. Variable costs are 40 percent of sales.

a. How large can Rogers' fixed operating costs be if he is to meet his profit target?

b. What is Rogers' breakeven level of sales at the level of fixed operating costs determined in (a)?

Reference no: EM1359277

Questions Cloud

How much work was done by the lift on the automobile : How much work was done by the lift on the automobile.

Explain government interaction has a major impact : Explain Government interaction has a major impact on businesses and personal lives. Identify two government policies that influence our business environment

Basics of intervention strategies : Briefly describe at least two intervention strategies that might be used with this population, given those needs. Provide specific examples and explain how each intervention might be applied.

What is the magnitude of the maximum magnetic force : Two point charges and are held in place 4.50 apart. Another point charge -2.5 of mass 6 is initially located 3.00 from each of these charges and released from rest. You observe that the initial acceleration of -2.50 is 354 upward, parallel to the ..

Compute fixed operating costs : Rodney Rogers, a recent business school graduate, plans to open a wholesale dairy products firm. The business will be completely financed with equity.

Write program to accept six pairs of values from user : Write a program that accepts six(6) pairs of values from the user and then calculates and stores the difference of each pair of values in an array.

Relapse prevention models : Provide a comparison (similarities and differences) of two relapse prevention models. Then, explain how each model might be applied in a substance abuse counseling setting, using specific examples.

Calculate the ebit-eps indifference point : Emco Products has a present capital structure consisting only of common stock. The corporation is considering a major expansion. At this time, the company is undecided between the following two financial plans

Explain the farm is expected to produce revenue : Explain The farm is expected to produce revenue of $2.02 million each year and annual cash flow from operations equals $1.87 million.

User Account

All Pages