What is the selling price needed to earn

Assignment Help Accounting Basics
Reference no: EM132576735

Care Products Company is considering a new product that will sell for P100 and have a variable cost of P60. Expected volume is 20,000 units. New equipment costing P1,500 and having a five-year useful life and no salvage value is needed, and will be depreciated using the straight-line method. The machine has cash operating costs of P20,000 per year. The firm is in the 40 percent tax bracket and has cost of capital of 12 percent. The present value of 1, end of five periods is 0.56743; present value of annuity of 1 for 5 periods is 3.60478.

Question 1: Suppose the 20,000 estimated volume is sound, but the price is in doubt. What is the selling price (rounded to nearest peso) needed to earn a 12 percent internal rate of return?

A. P81.00

B. P70.00

C. P85.00

D. P90.00

Reference no: EM132576735

Questions Cloud

What types of stories are games best for exploring : What types of stories are games best for exploring? What do they do better or worse than other media? How could games be used to tell important stories.
What made the introduction-conclusion effective : Locate a speech with an exemplary introduction and/or conclusion. Post a link to the video for your classmates to view. Using terms from the current chapter.
NR351 Transitions in Professional Nursing Assignment : NR351 Transitions in Professional Nursing Assignment Help and Solution - Chamberlain College of Nursing, USA - Homework Help
Describe how people rebuild in the aftermath : Personal, first-hand accounts of disasters provide us with the most poignant information about what disaster is like as it happens, and how people rebuild.
What is the selling price needed to earn : Suppose the 20,000 estimated volume is sound, What is the selling price (rounded to nearest peso) needed to earn a 12 percent internal rate of return?
Argumentative paper - divorcing : Argumentative paper - divorcing rather than staying when children are involved and the impact of staying vs leaving. Family structure, emotional/physical
Describe the data analysis and interpretation of results : Methodology, data analysis and interpretation of results, including any limitations or flaws in the experimental design, data analysis or in the interpretation.
What are the net tax consequences of gains for barbara : What are the net tax consequences of these gains and losses for Barbara? Barbara Bliss had the recognized gains and losses during 2019.
Globalization imposes on developing economies : define globalization and explain why it is important to business and Briefly discuss one important benefit and one crucial risk that globalization imposes

Reviews

Write a Review

Accounting Basics Questions & Answers

  What the benefits and risks of e-commerce for your company

Research the dispute process and the requirements for the country you selected in Module 1. What are the benefits and risks of e-commerce for your company

  Elliot uses the capm to estimate its cost of the common

elliot athletics is trying to determine its optimal capital structure which now consists of only debt and common

  Compute the present value of the tax shield

Rush Corporation plans to acquire production equipment for $620,000, Compute the present value of the tax shield

  There are two sets of numbers after each category the

looking for income statement and balance sheet for the better usa inc. company for 2010 and 2011there are two sets of

  31 the petty cash fund has 29 in cash and 284 in petty cash

the following petty cash transactions of lexite laminated surfaces occurred in augustaug 1 established a petty cash

  Discuss companys financial ratios

Provide a summary of the comparison of the selected company's financial ratios to those of a competitor

  How unethical choices by some players harms players

Using the MLB steroids case as an example, explain how unethical choices by some players harms players who comply with the rules.

  What is Reggie medical expense deduction

Reggie received $515 in 2019 for a portion of the doctors fees from his insurance. What is Reggie's medical expense deduction

  By how much will the company net operating income increase

The president believes that a $16,000 increase in the monthly advertising budget, by how much will the company's net operating income increase or decrease

  Prepare zoops journal entries related to this investment

Zoop Corporation purchased for $300,000 a 30% interest in Murphy, Inc. This investment enables Zoop to exert significant influence over Murphy.

  Calculate the markup percentage using variable-cost pricing

fixed selling and administrative expenses $29. Its desired ROI per unit is $31. Calculate the markup percentage using variable-cost pricing

  Distributing all after-tax income as dividends

The salary is reasonable in amount and George is in the 35% marginal tax bracket irrespective of any income from Black. Assuming that Black Corporation distributes all after-tax income as dividends, how much total combined income tax do Black and ..

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