What is the annual operating margin in dollars

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Question - Hermione is required to annually assess the impairment of her Traveling Tote factory productions. Currently, she estimates that the factory can continue operations for 10 years. The factory can produce 10,000 units a year and sell for $200 a Tote. Her operating margin is 20%. Assuming a Book Value of $3.5M and a required rate of return of 5%, answer the following questions:

What is the annual operating margin in dollars?

What is the sum of the net present value of the 10-year operating margin (ignore impact of tax, depreciation, etc)?

Is impairment required?

Reference no: EM133075392

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