How sensitive is ocf to changes in quantity sold

Assignment Help Financial Accounting
Reference no: EM132802532

Consider a project with a life of 6 years with the following information:

initial fixed asset investment = $330,000;

straight-line depreciation to zero over the 6-year life;

zero salvage value; price = $34;

variable costs = $19;

fixed costs = $132,000; quantity sold = 87,120 units;

tax rate = 23 percent.

Problem 1: How sensitive is OCF to changes in quantity sold?

Reference no: EM132802532

Questions Cloud

Compute the average cost per mile of owning : Kristen drove the car 24,000 miles last year. Compute the average cost per mile of owning and operating the car. (Round your answers to 2 decimal places.)
What is the wavelength of the radio : What is the wavelength of the 60,000-Hz radio wave used by 'radio-controlled' clocks and wristwatches? Answer in meters.
How much are expected cash receipts for february : A company's past experience indicates that 70% of its credit sales are collected in the month of sale. How much are expected cash receipts for February
Calculate the contribution margin ratio : Calculate the Contribution Margin ratio. Calculate the number of units they need to sell to break even. Sale Revenue (1,000 units x $400 per unit) $400,000
How sensitive is ocf to changes in quantity sold : How sensitive is OCF to changes in quantity sold? straight-line depreciation to zero over the 6-year life; initial fixed asset investment = $330,000
Write the journal entries to record the payments of interest : Write the journal entries to record the payments of interest to note holders on 30 June 2021. Write the journal entry to record the issue of convertible notes.
What is the required return : If you deposit $5000 in a saving account and you expect to have $30,000 after 6 years, what is the required return
Calculate the amount credited to retained earnings : Calculate the amount either (debited) or credited to retained earnings. On March 1, 2019, Baltimore Corporation had 80,000 shares of common stock.
What then is most useful information collected from devices : It is sometimes said that information extracted from a router or switch does not necessarily provide specific evidence of a particular crime.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Prepare for heaven ltd the statement of financial position

Prepare, for Heaven Ltd, the statement of financial position, statement of changes in equity and notes thereto at 30 June 2016 in accordance with the requirements of AASB 101.

  What is operating income of both divisions together

Assume 200 barrels are transferred from the Production Division to the Refining Division for a transfer price of $6 per barrel. The Refining Division sells the 200 barrels at a price of $40 each to customers. What is operating income of both divis..

  How the fed uses open market operations to increase money

Explain why you feel the FDIC has raised its limits on the amount of insurance it provides over the years. What impact did that have on customers and banks?

  Determine the amount the cashier stole from parker

Determine the amount the cashier stole from Parker Company. Show your computations in good form. How did the cashier attempt to conceal the theft?

  What are the effects of the transactions in cash flow

For each of the notes, determine the (a) maturity date, (b) interest on the note, and (c) maturity value. Assume that the fiscal year for Rich Importing Company ends on June 30. How much interest income should be recorded on that date? What are the e..

  Analyzing the effects of four alternative inventory methods

Analyzing the Effects of Four Alternative Inventory Methods in a Periodic Inventory System,   Compute the amount of goods available for sale, ending inventory, and cost of goods sold at January 31, 2009, under each of the following inventory costing ..

  Calculate the current value of the future payments

You invest $25,000 today at 8% per year. How much money will you have accumulated after 13 years? Your friend has learned that he is going to receive $7,500 a year for the next 10 years. Utilizing 5% interest rate, calculate the current value of the ..

  Three activities in its manufacturing process

Mordica Company identifies three activities in its manufacturing process: machine setups, machining, and inspections. Estimated annual overhead cost for each activity is $150,000, $325,000, and $87,500, respectively.

  Ending inventory using conventional retail inventory method

The records of Flounder’s Boutique report the following data for the month of April. Sales revenue $103,300 Purchases (at cost) $52,100 Sales returns 2,200 Purchases (at sales price) 95,200 Markups 9,000 Purchase returns (at cost) 2,200 Markup cancel..

  Compute the net cash from operating activities

Glitter Girl, Inc. recognized net income of $205,000 including $60,000 in depreciation expense. Additional changes from the balance sheet are as follows. Accounts Receivable $2,000 decrease Prepaid Expenses $15,000 decrease Inventory $36,000 increase..

  Prepare an invoice

How do you take a known dollar value such as $240.00, back out the sales taxes from the known values using the States sales tax

  Why is it important that companies review outstanding

Why is it important that companies review outstanding accounts payable in connection with prevention or detection of inventory fraud?

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