Consider a three-year project with the following information

Assignment Help Finance Basics
Reference no: EM13273062

Consider a three-year project with the following information: initial fixed asset investment = $694,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $33.95; variable costs = $22.50; fixed costs = $209,500; quantity sold = 95,500 units; tax rate = 40 percent.

What is the OCF at the base-case quantity sold?
What is the OCF at 96,500 units sold?
How sensitive is OCF to changes in quantity sold?

 

Reference no: EM13273062

Questions Cloud

What is the profit or loss associated with copper : Allocate the joint costs using the relative sales values. With these costs, what is the profit or loss associated with Copper?
What is the standard deviation of a two-asset portfolio : What is the standard deviation of a two-asset portfolio if one of the assets has a standard deviation of 0.30, the other asset has a standard deviation of 0.15, and the correlation coefficient between the two assets is 0.15 if ten percent of the p..
Peter hired a cleaning service to clean the rugs : The vacuum cleaner was delivered on Friday, the day before the party, when the rugs in Peter's home were quite dirty. The vacuum cleaner did not work properly. Peter notified the seller, who responded by saying that nothing could be done until ..
Evaluation of the effectiveness of the health care system : What is your evaluation of the effectiveness of the U.S. health care system in the context of delivery, finance, management, and/or sustainability? What are the issues that prompted a need for health care reform?
Consider a three-year project with the following information : Consider a three-year project with the following information: initial fixed asset investment = $694,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $33.95; variable costs = $22.50; fixed costs = $209,50..
What is the incremental savings of buying the valves : However, the space occupied by the production of the valve can be used by another production group that is currently leasing space for $55,000 per year. What is the incremental savings of buying the valves?
Determine the frequency of the car horn : A man driving a car toward a large vertical wall sounds his horn. The car is traveling at 92 km/h. What is the frequency of the car horn
Prosecutor in a burglary case : You are a prosecutor in a burglary case. You want the defendant to plead guilty, so you stack the charges against him. You add a felony theft charge and misdemeanor theft charge to the burglary complaint hoping the defendant will be compelled to plea..
Eliminate or minimize each of these anticipated challenges. : Examine two (2) approaches that the original company you selected has taken in order to embrace technological advancements for innovation and thus improve business offerings. Anticipate three (3) potential technological challenges the company ..

Reviews

Write a Review

Finance Basics Questions & Answers

  Objective type questions on financial strategies

Objective type questions on Financial strategies and is it true or false that Corporate shareholders are exposed to unlimited liability

  International business acquisition

Bank selection for international business acquisition.

  Objective type questions on issue of dividend

Objective type questions on issue of dividend, which cost are a function of time and not sales and typically contractual

  Define products or services as commodities

Explain whether you would view their products or services as commodities and define your reasoning

  Computation of earnings per share

Pulp Paper Corporation and Holt Paper Corporation are able to generate earnings before interest and taxes of $150,000.

  What is the stock expected total return for the coming year

If last dividend = $4.3, g = 8.4%, and P0 = $75, what is the stock's expected total return for the coming year?

  Determine net operating income

During 1998, the Senbet Discount Tire firm had gross sales of $1 million. The company’s cost of goods sold and selling expenses were $300,000 and $200,000, respectively.

  Determine the business risk and the financial risk

Suppose that a firm has following Income Statement. Use this information to estimate the business risk and the financial risk as measured by the degree of operating leverage.

  How much must the member pay

An HMO pays only 75% of approved charges for its HMO patient members. If a member goes out of the approved network of providers and incurs a charge of $ 1,100, of which $ 650 is approved, how much must the member pay?

  What is the best way to select a project

What is the best way to select a project that has resource restrictions? Explain.

  Determination of current share price

Baruk Industries has no cash and a debt obligation of 36 million dollar that is now due. The market value of Baruk's assets is $81 million, and the firm has no other liabilities. Suppose perfect capital markets.

  Identify two financial intermediaries

Identify two financial intermediaries. What are their respective functions? What are their major roles in the economy?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd