A cost-cutting project will decrease costs by $67,300 a year.
The annual depreciation will be $16,650...
A cost-cutting project will decrease costs by $67,300 a year.
The annual depreciation will be $16,650 and the tax rate is 35
percent. What is the operating cash flow for this project?
A project has fixed costs of $1,500 per year, depreciation
charges of $500 a year, annual revenue of $9,000, and variable
costs equal to two-thirds of revenues.
a. If sales increase by 13%, what will be the percentage
increase in pretax profits? (Round to 2 decimal places)
b. What is the degree of operating leverage of this project?
(round to 2 decimal places)
A project has fixed
costs of $2,400 per year, depreciation charges of $300 a year,
annual revenue of $21,600, and variable costs equal to two-thirds
of revenues.
a. If
sales increase by 19%, what will be the percentage increase in
pretax profits?
b.
What is the degree of operating leverage of this project?
A project has annual depreciation of $24,700, costs of $100,700,
and sales of $148,500. The applicable tax rate is 35 percent. What
is the operating cash flow?
$31,070
$47,125
$105,170
$39,715
$25,375
What is the present value of costs for a 30-year project that
has annual maintenance costs of $1.1 million per year, but also
requires additional major maintenance costing $9 million every ten
years?
You may assume major maintenance is needed after 10 years and 20
years but not after 30 years (at the end of the project). Assume a
discount rate of 8% and that all costs are incurred at the end each
year.
Enter your answer in the box...
Vandelay Industries is evaluating a project that costs
$1,350,000 and has a 20 year life. Depreciation will be
straight-line to zero over the life of the project. Management
believes they will be able to sell the equipment at the end of the
project for $50,000. Sales are projected to be 50,000 units in the
first year, 70,000 units in the second year, and 25,000 units for
all additional years. Price per unit is $34.50, variable cost per
unit is $15.50...
Vandelay Industries is evaluating a project that costs
$1,350,000 and has a 20 year life.
Depreciation will be straight-line to zero over the life of the
project. Management believes they
will be able to sell the equipment at the end of the project for
$50,000. Sales are projected to be
50,000 units in the first year, 70,000 units in the second year,
and 25,000 units for all additional
years. Price per unit is $34.50, variable cost per unit is
$15.50...
Vandelay Industries is evaluating a project that costs
$1,350,000 and has a 20 year life. Depreciation will be
straight-line to zero over the life of the project. Management
believes they will be able to sell the equipment at the end of the
project for $50,000. Sales are projected to be 50,000
units in the first year, 70,000 units in the second year, and
25,000 units for all additional years. Price per unit is
$34.50, variable cost per unit is $15.50 and fixed costs...
2) A proposed project has fixed costs of $25,000 and
a depreciation of $8,000 per year. The variable costs are $7 per
unit and sales are $9 per unit.
a) What is the breakeven point in units produced?
b) What is the breakeven point in dollars of
revenue?
c) If the operating profit at 20,000 units is $7,000.
What is the degree of operating leverage?
d) If sales increase to 22,000 units, what will
operating profits...
The selling price, variable costs, annual fixed costs, annual
depreciation charges, and marginal tax rate for the project are
shown below. If sales are equal to 14,000 units, what is
the after-tax profit?
Sales Price
$3.00
Variable Costs
$1.40
Fixed Costs
$15,000.00
Depreciation
$6,000.00
Tax Rate
35%
A mesquite farmer wants you to invest in his mesquite harvesting
business. He sells mesquite wood to several
"Texas-style" steakhouses that serve authentic "Mesquite-smoked"
steaks. He promises to give you all profits for 5 years
after...
Tank Co. is evaluating a project that costs $120000, has a
5-year life.
Assume that depreciation is prime-cost to zero salvage value
over the 5-years, and the equipment
can be sold for $6,000 at the end of year 5. The average
discount rate for such project is 10 per
cent on such projects. The individual tax rate is 15 per cent
and corporate tax rate is 30 per cent.
It is projected that they will sell 12000 units per year....