Firm need to reach the cash break-even point

Assignment Help Financial Management
Reference no: EM131495307

Calloway Cab Company computes break-even point strictly on the basis of cash expenditures related to fixed costs. Its total fixed costs are $400,000, but 20 percent of this value is represented by amortization. Its contribution margin(price variable cost) for each unit sold is $3.60. How many units does the firm need to reach the cash break-even point?

Reference no: EM131495307

Questions Cloud

Yield to maturity takes into account everything except : Yield to maturity takes into account everything except: annual interest received.
Investment firm that focuses on opportunities : Blackrock Capital is an investment firm that focuses on opportunities in South America.
Expected annualized yield from this transaction : Determine Earl's expected annualized yield from this transaction.
Determine kevins annualized yield on this investment : Determine Kevin's annualized yield on this investment.
Firm need to reach the cash break-even point : How many units does the firm need to reach the cash break-even point?
Assuming all costs vary proportionately with sales : Sales are expected to increase by 22 percent next year. What is the pro forma addition to retained earnings assuming all costs vary proportionately with sales?
What is the expected payout ratio : If Bike uses residual distribution model to determine next year’s distribution and makes all distributions in form of dividends, what is expected payout ratio?
Compute landon self-employment tax liability : Compute Landon’s self-employment tax liability and the allowable income tax deduction of the self-employment tax paid.
What is palm trees intrinsic value of equity : What is Palm Tree’s intrinsic value of equity? What is its intrinsic stock price per share?

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the arithmetic average returns and the variances

Returns Year X Y 1 20 % 15 % 2 23 35 3 9 14 4 – 16 – 21 5 10 25 Using the returns shown above, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y.

  How knowledge management enhances the ability of business

A co-worker approaches you with a quizzical look on their face. They know you just earned a master degree at Baker College and want to ask you a MIS-related question. How might you describe the difference to your co-worker so that they appreciate the..

  What is the companys target debt-equity ratio

Fama’s Llamas has a weighted average cost of capital of 9.2 percent. The company’s cost of equity is 12 percent, and its pretax cost of debt is 7.2 percent. The tax rate is 40 percent. What is the company’s target debt−equity ratio?

  Prevailing interest rate or yield to maturity

Suppose the prevailing interest rate, or yield to maturity is 6%. All bonds have $100 face value. Price a discount bond of 10 year maturity. Show your work. Write down the formula you would use to price an annual coupon bond with annual coupon rate o..

  Act in the interest of existing shareholders

Assume you are the CEO of a company, MBA Inc, and you always act in the interest of existing shareholders. Your company has one asset, The Diploma, and one investment opportunity. The values of the asset and the opportunity depend on the state of the..

  The value of gillettes stock

Assume Gillette Corporation will pay an annual dividend of $0.64 one year from now. Analysts expect this dividend to grow at 12.7% per year therafter until the 6th year. Therafter, growth will level off at 2.5% per year. The value of Gillette's stock..

  When should a speculator purchase a put option on dollars

Speculating with currency options. When should a speculator purchase a call option on Australian dollars? When should a speculator purchase a put option on Australian dollars?

  Project has annual cash flows

A project has annual cash flows of $3,500 for the next 10 years and then $7,000 each year for the following 10 years. The IRR of this 20-year project is 11.59%. If the firm's WACC is 9%, what is the project's NPV?

  Part of the net initial investment in project

Which of the following items are not considered as a part of the net initial investment in a project?

  Profit margin and asset turnover can be combined to create

Profit margin and asset turnover can be combined to create. Elsie Jackson is saving for a down payment on a condo. She needs 20,000. How much must she invest in a savings account that pays 5% annually to have the 20,000 in 8years? Round to the neares..

  Equal nominal annual payments

You take out a loan for $16101 that has equal nominal annual payments over the next five years. The real rate of return on the loan is 3.9%, and the annual inflation rate is 2.1%. What will the payments be?

  What is the company cost of common equity

Cost of Equity with and without Flotation Javits & Sons' common stock currently trades at $28.00 a share. It is expected to pay an annual dividend of $1.00 a share at the end of the year (D1 = $1.00), and the constant growth rate is 3% a year. What i..

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