Xia-Ming is considering the expansion of her picture-framing camera business to include the printing of oversize pictures from She would need to lease equipment, at a cost of $66 per month. To process the pictures, she estimates that she would have se expenses of $4 per picture. Xia-Ming estimates that she can sell 60 pictures per month. (a) What price should she charge to break even? (b) Compute the break-even point in sales dollars. The picture frames should be sold for $ to break even. (Round to the nearest cent as needed Round all intermediate values to six decimal places as needed)
Q: various investment alternatives for each scenario. Answer the questions that follow. State of the…
A:
Q: Fill the parts in the above table that are shaded in yellow. You will notice that there are nine…
A: Formula for calculating Mean, Standard deviation and coefficient of variation with probability is as…
Q: A. Average age of inventory + average collection period – average payment period. B. Average…
A: Cash conversion cycle indicates the number of days a firm takes to churn its inventory to generate…
Q: Limited has a target capital structure of 45% debt, 15% preferred stock and 40% common equity. The…
A: Bonds are kind of debt and is the long term sources of capital for company and cost of debt is very…
Q: an investment of 300000 can be made in a project that will produce a uniform annual revenue of…
A: Data given: Investment=300000 Annual Revenue=220,000 Salvage value=Investment *10%=300000*10%…
Q: An investor is given the opportunity to invest in one of the two projects: Project A costs $10000…
A: Net Present Value The method of capital budgeting helps the investor to calculate the profitability…
Q: What is the tex-equivalent interest rate needed if you purchase a municipal bond wiht a face value…
A: Municipal bonds are bonds issued by state or local governments. They are generally tax exempt.
Q: You are considering investing in a real estate project. Your one ownership unit would cost $ 30,000.…
A: Solution:- Net Present Value (NPV) means the net present value of cash inflows from the project…
Q: Consider the following information about the various states of economy and the returns of various…
A: Formula for calculating Mean, Standard deviation and coefficient of variation with probability is as…
Q: Problem 12a: Fullerton IV Company has had a policy of reordering inventory every 30 days. Using the…
A: The EOQ refers to the economic order quantity where the ordering cost and carrying cost of the…
Q: You own a portfolio equally invested in a risk-free asset and two stocks. If one of the stocks has a…
A: Since equally invested in risk free asset and 2 stocks Weight of each stock=(1/3)
Q: A financial manager is reviewing three potential portfolios. His goal is to find the best portfolio…
A: Portfolio Small-cap Mid-Cap Large-Cap A $ 2,000.00 $ 3,000.00 $ 5,000.00 B $…
Q: ADD-ON LOANS vs SIMPLE INTEREST LOANS. You are borrowing $500,000 on a 30 year, 5.5% interest loan…
A: Add on loans are loan where the monthly payments are calculated by dividing the total principal by…
Q: Procter and Gamble (PG) paid an annual dividend of $2.81 in 2018. You expect PG to increase its…
A: The dividend in the year 2018 is $2.81 The growth rate for the next 5 years is 8.6% The required…
Q: Suppose the interest rate on investments in GBP is 12% in London and the interest rate for…
A: Covered interest rate parity is used to define the relationship between the forward and spot…
Q: You are considering investing in a project which will last four years. You will invest £500,000 at…
A: Net present value is the difference between present value of cash inflows and outflows.
Q: 8. A firm has to pay a dividend of $1.20 per share till perpetuity, a zero growth rate of dividends,…
A: Solution: Preferred shares are those shares which get a fixed dividend amount each period. Value of…
Q: State of Economy Probability T-Bills Phillips Pay-up Rubber-Made…
A: according to bartleby guidelines , if question involves multiple subparts , then 1st sub 3 parts…
Q: What would be concluded about the South African Mobile Phone sector between 2008 and 2011? A. The…
A: Stock markets show ups and downs and stocks market are quite volatile in nature but overall market…
Q: Consider the following information about the various states of economy and the returns of various…
A: State of the economy Probability T-Bills Philips Pay-up Rubber-Made Market Index Recession 0.2 7%…
Q: Using the Treasury yield information in part c, calculate the following rates using geometric…
A: Data given: Maturity (year) Yield 1 5.37% 2 5.42% 3 5.58% 4 5.64% 5 5.56% 10 5.68%…
Q: A company manufactures a single product which has variable cost of £40 per unit. The contribution to…
A: Break-Even point (units) = Fixed Costs ÷ (Sales price per unit – Variable costs per unit)
Q: A project has the following cash flow with a discount rate of 12%: Annual cash flows: Year 0 $ Year…
A: The payback period is used to calculate the time the project takes to recover its initial…
Q: Shearer’s Foods, part of the $374 billion global snack food industry, employs 3,300 people in…
A: As per our guidelines, we are supposed to answer only one question, if there are multiple questions…
Q: Anos 0 1 23 4 5 6 Fluxo de Caixa ($) 0 290.000,00 140.000,00 200.000,00 -1.240.000,00 800.000,00…
A: IRR is the rate at which initial invest equal to the present value of all cash flows. Net present…
Q: CNBC reported that one in five consumers who purchase bitcoin do so using their credit card. Melissa…
A: Book value The value of an asset shown in a company's books is called its book value. It is the…
Q: Which of the following is typically a feature of common stock? A) Most common stocks are callable.…
A: Common stock provides ownership of the company to its holders in exchange for equity. The common…
Q: What was the arithmetic average return on the stock over this five-year period? What was the…
A: 1. Airtmetic Mean = Total Return, getting by adding all the returns of each year/ no of years…
Q: Sam owns a yogurt drink van. She is buying yogurt from a supplier for £0.50 per bottle and sells for…
A: Contribution per unit = Selling price per unit - Variable cost per unit As insurance and salary…
Q: Complete using the declining balance method of depreciation (Round to nearest hundredth of a…
A: Solution:- Depreciation is the wear and tear cost of asset. It is the cost of use of asset. In…
Q: Suppose Taneal is considering combining the two portfolios into a single portfolio. If she invests…
A: We have; The weightage of portfolio A is 60% The weightage of portfolio B is 40% Return A is 23.30%…
Q: year forward contract was established with a price of $70.25. Now, a year and a half later (t= 1.5…
A: The forward are contract that are to be settled in the future based on the spot prices and it may be…
Q: AR company is considering a new three-year project to build on the land they bought at 1 million…
A: Operating cash flow The cash that a business generated from its normal operations is known as…
Q: Pearson Motors has a target capital structure of 35% debt and 65% common equity, with no preferred…
A: Weighted average cost of capital reflects the total cost of capital after considering the effect of…
Q: Determine the outstanding principal of the given mortgage. HINT [See Example 7.] (Assume monthly…
A: Loan amount,PV is $100,000 The time period is 35 years The interest rate is 4.6% compounded monthly…
Q: Calculate the weighted mean from the following sales: $400, $700, $300, $600, $300, $400, $700…
A: Weighted mean:-The weighted mean is a sort of mean that is computed by dividing the weight (or…
Q: In 2014, Amira corporation had current assets of $144 million, inventory of $42.9 million and total…
A: Quick ratio = Current assets - InventoryCurrent liabilities Quick ratio in 2014 = $144 million-$42.9…
Q: nsider a stock worth K12.50 that can go up or down by 15% per period. Assume a period process of…
A: Call options gives opportunity to buy the stock on expiration period but there is no obligation to…
Q: Consider the following information about the various states of economy and the returns of various…
A: State of the economy Probability T-Bills Philips Pay-up Rubber-Made Market Index Recession 0.2 7%…
Q: Salleh Industries has decided to expand its business and it needs RM5 million. Three sources of…
A:
Q: UNIT 4: CAPITAL STRUCTURE THEORY AND POLICY a) Crown Data(CD) has a current capital…
A: EBIT indifference point of financing is the level of EBIT when the Earnings per share (EPS) of the…
Q: Heavy Metal Corporation is expected to generate the following free cash flows over the next five…
A: Concept. Value of firm = value of equity + value of debt. For calculating value of firm , present…
Q: Which one of the following could be considered as an advantage of using the payback method of…
A: Solution: Payback period represents that period where the initial cost of the investment gets…
Q: Consider the following table, which gives a security analyst's expectations for return on the market…
A: Expected returns from market and two other portfolios over different states of economy are given. We…
Q: Test 2: Risk Management Name: Surname: Group: Give detailed solutions in the spaces provided s to…
A: Expected loss is mean loss based on the probability of each loss. Standard deviations show how much…
Q: Subsequent Expansions A few years after the initial expansion, Gonzaleswants to build a plant and…
A: a) A bond which has collateral attached to it is known as secured bond. In the event of any default…
Q: Compare and contrast non-discounting methods and discounting methods used in investment appraisals.…
A:
Q: How you arrive at the answer is not clear can you please expound further? Don't understand what was…
A: The Face value of bond $1000 Coupon rate is 12%
Q: A firm evaluates all of its projects by applying the IRR rule. A project under consideration has the…
A: Year Cash Flows 0 $ -28,700.00 1 $ 12,700.00 2 $ 15,700.00 3 $ 11,700.00 To Find:…
Q: Roybus, Inc., a manufacturer of flash memory, just reported that its main production facility in…
A:
Step by step
Solved in 2 steps
- Ingrid is planning to expand her business by taking on a new product that costs $7.56. In order to market this new product, $1307.00 must be spent on advertising. The suggested retail price for the product is $11.31. (a) If a price of $14.49 is chosen, how many units does she need to sell to break even? (b) If advertising is increased to $1674.00, and the price is kept at $11.31, how many units does she need to sell to break even?Having recently graduated with a visual arts degree, Zane is considering starting a new business in this field, selling exotic artwork. He believes he can sell each piece of artwork for an average price of $600. The suppliers of the artwork will be paid a commission of 25% of the price. Artwork will be packed and delivered to the customer. Zane estimates that packing and delivery costs should be about $30 per product. There will be additional expenses associated with running the store. Rent will be $5,400 per month. Utilities (which it is assumed will not vary from month to month) will be $990 per month. Insurance and other expenses will be $750 per month. He plans to pay himself and one sales assistant salaries of $10,500 per month ($7,500 for himself and $3,000 for his assistant). The tax rate is assumed by Zane to be 30%. Required: a. Based on the information how many pieces of artwork per month would Zane need to sell to break even? Show all workings. b. If Zane wanted to earn a…KNS estimates that if he purchases the new equipment and lowers his price to P44.55 per item, his volume will increase to about 4,700 units per month. Based on the local market, that is the largest volume he can realistically expect. WHAT SHOULD KNS DO?
- Ella buys a machine for $ 18,500, less discounts of 20% and 15%. The overhead expenses are 8% on cost and she plans to make a profit of 60% on cost. a) What is the regular selling price? b) What is the profit or loss if she offers a markdown of 22%? C) What is the maximum markdown rate she can offer to sell at the break-even price? Ativate WindowXavi sells seashore paintings. His annual Fixed Costs are $1,000 and the Variable Costs are $8 per painting. Xavi is considering advertising his artwork in a local gallery, the cost of which is $80 per month. What would be the new annual breakeven revenue (in dollars) if he continues to sell his pieces for $15?After three years in the cake shop business, Gloria has decided she can now afford to advertise. An advertising package would cost her $30,416 for one year. Assuming advertising is a fixed cost and her unit contribution is now $8.75, how many additional cakes would she need to sell to make the advertising package worthwhile? That is, how many additional cakes does she need to sell to pay for the advertising and breakeven. Round to the nearest whole number.
- Ingrid is planning to expand her business by taking on a new product that costs $6.74. In order to market this new product, $1159.00 must be spent on advertising. The suggested retail price for the product is $14.67. Answer each of the following independent questions. (a) If a price of $17.43 is chosen, how many units does she need to sell to break even? (b) If advertising is increased to $1377.00, and the price is kept at $14.67, how many units does she need to sell to break even? CIDAshley is a fresh graduate and is now planning to start a new business. She would run an online shop to sell snacks imported from Japan. She expects the annual purchase cost would be $380,000 and the annual sales would be $790,000. Four sets of computers are needed, which cost $7,000 each and could be sold at half price in the second-hand market after one year. She has to rent a small office, which costs her $19,000 per month. (i) Calculate the annual accounting profit of Ashely's snack business. (ii) Ashley will be involved in the daily operations of this snack business and has to give up the opportunity to get a full-time job. În consideration of annual economic profit, in what condition should Ashley start this business? Explain with relevant figures.Kath is considering investing 500,000.00 to open a Milk Tea Station near a mall. Based on her feasibility study, she can sell 12 large size of milk tea per hour at a price of 25.00 per bottle. She is planning to hire 2 crews, with an hourly rate of 25.00, to manage the store which will operate 8hours per day, 6 days per week, and 50 weeks per year. However, additional out-of-pocket miscellaneous cost is 8,500.00 per month. More so, she wanted to have her crews a 2-week vacation every year with pay. If the capital now is earning 15% annually and she must write off her investment within 5 years with desire rate of return of at least 20% on his investment, would you recommend the investment? Use the rate of return method and annual worth method in making your decision.
- Beryl’s Iced Tea currently rents a bottling machine for $50,000 per year, including all maintenance expenses. It is considering purchasing a machine instead, and is comparing two options: Purchase the machine it is currently renting for $150,000. This machine will require $20,000 per year in ongoing maintenance expenses. Purchase a new, more advanced machine for $250,000. This machine will require $15,000 per year in ongoing maintenance expenses and will lower bottling costs by $10,000 per year. Also, $35,000 will be spent upfront in training the new operators of the machine. Suppose the appropriate discount rate is 8% per year and the machine is purchased today. Maintenance and bottling costs are paid at the end of each year, as is the rental of the machine. Assume also that the machines will be depreciated via the straight-line method over seven years and that they have a 10-year life with a negligible salvage value. The marginal corporate tax rate is 35%. Should Beryl’s Iced…Andy purchased a new drone last year for $1,500. He no longer uses the drone and wants to sell it. He currently values the drone at $400. Suppose Jeff wants to purchase a drone. His maximum willingness to pay for a drone is $700. Instructions: Enter your answers as a whole number. Suppose Andy and Jeff agree on a price of $500 for the drone. a. How much producer surplus will this transaction generate? $ b. How much consumer surplus will this transaction generate? 100 400 c. What will be the total surplus generated from this transaction? $ 90You are trying to decide between two mobile phone carriers. Carrier A requires you to pay $180 for the phone and then monthly charges of $64 for 24 months. Carrier B wants you to pay $90 for the phone and monthly charges of $72 for 12 months. Assume you will keep replacing the phone after your contract expires. Your cost of capital is 3.9%. Based on cost alone, which carrier should you choose? Based on cost alone, you will choose Carrier A (Select from the drop-down menu.) Carrier B Carrier A