Question

In: Finance

Jack is considering adding work jeans and T-shirts to the items he stocks in his general...

Jack is considering adding work jeans and T-shirts to the items he stocks in his general store provided that his payback period is less than 2.5 years. He estimates that the initial cost of inventory will be $6,750. The remodeling expenses required for this addition are $18,200. Jean and T-shirt sales are expected to produce net cash inflows of $10,200, $14,500, and $16,600 over the next three years, respectively. Jack _____ add the jeans and T-shirts to his offerings as the payback period is _____ years.

Multiple Choice

  • should; 1.67

  • should; 3.67

  • should; 2.02

  • should not; 3.67

  • should not; 2.02

Solutions

Expert Solution

jeff jeffy answered 1 week ago
Next > < Previous

Related Solutions

Burke's Corner currently sells blue jeans and T-shirts. Management is considering adding fleece tops to its...
Burke's Corner currently sells blue jeans and T-shirts. Management is considering adding fleece tops to its inventory to provide a cooler weather option. The tops would sell for $53 each with expected sales of 4,300 tops annually. By adding the fleece tops, management feels the firm will sell an additional 285 pairs of jeans at $65 a pair and 420 fewer T-shirts at $26 each. The variable cost per unit is $36 on the jeans, $16 on the T-shirts, and...
Burke's Corner currently sells blue jeans and T-shirts. Management is considering adding fleece tops to its...
Burke's Corner currently sells blue jeans and T-shirts. Management is considering adding fleece tops to its inventory to provide a cooler weather option. The tops would sell for $54 each with expected sales of 3,850 tops annually. By adding the fleece tops, management feels the firm will sell an additional 240 pairs of jeans at $64 a pair and 375 fewer T-shirts at $25 each. The variable cost per unit is $32 on the jeans, $16 on the T-shirts, and...
please show work. 2. Since Jack believes that Work Center 3 is his bottleneck, he has...
please show work. 2. Since Jack believes that Work Center 3 is his bottleneck, he has asked you to do the following: a) Calculate the percentage of planned output needed to complete the planned inputs (planned input + backlog/ planned output) at Work Center 3. b) Calculate the percentage of planned input that actually happened (actual input + backlog/planned input + backlog). information needed to answer the question above. Jack, the owner and manager of Jack’s Box Company, wants to...
Bill sells t-shirts. He has 10 in stock and is currently cashless. His preference as given...
Bill sells t-shirts. He has 10 in stock and is currently cashless. His preference as given by u(x1,x2)=10ln x1+x2 which implies that his mrs=10/x1 Find an expression for Bill's willingness to supply shirts at a given price, p. (Be sure it is an expression for how many shirts Bill sells at price p and not an expression for how many he keeps.)
Company Gamma produces and sells plain t-shirts but is considering entering the market of coloured t-shirts....
Company Gamma produces and sells plain t-shirts but is considering entering the market of coloured t-shirts. The plain t-shirts produced by Company Gamma costs $1 per unit and are sold for $5 per unit. If Company Gamma starts producing and selling coloured t-shirts, the cost is expected to be $1.20 per unit and sold for $6 per unit. Required: Show whether it is worth processing the plain t-shirts into coloured t-shirts. Company Gamma has found a more efficient way of...
Jack is comparing Team Shirts to Xtreme T's. He found that the gross profit ratio was...
Jack is comparing Team Shirts to Xtreme T's. He found that the gross profit ratio was 47% for Team Shirts and 50% for Xtreme T's. This is an example of ________ analysis.
Jack is single and he made his first taxable gift of $1,000,000 in 2008. Jack made...
Jack is single and he made his first taxable gift of $1,000,000 in 2008. Jack made additional gifts in 2009, at which time he gave $1,750,000 to each of his three children and an additional $1,000,000 to State University (a charity). The annual exclusion in 2009 was $13,000. Recently Jack has been in poor health and would like you to estimate his estate tax should he die this year. Jack estimates his taxable estate (after deductions) will be worth $5.4...
Jack is single and he made his first taxable gift of $1,000,000 in 2008. Jack made...
Jack is single and he made his first taxable gift of $1,000,000 in 2008. Jack made additional gifts in 2009, at which time he gave $1,750,000 to each of his three children and an additional $1,000,000 to State University (a charity). The annual exclusion in 2009 was $13,000. Recently Jack has been in poor health and would like you to estimate his estate tax should he die this year. Jack estimates his taxable estate (after deductions) will be worth $5.4...
Jack is single and he made his first taxable gift of $1,000,000 in 2008. Jack made...
Jack is single and he made his first taxable gift of $1,000,000 in 2008. Jack made additional gifts in 2009, at which time he gave $1,750,000 to each of his three children and an additional $1,000,000 to State University (a charity). The annual exclusion in 2009 was $13,000. Recently Jack has been in poor health and would like you to estimate his estate tax should he die this year. Jack estimates his taxable estate (after deductions) will be worth $10.4...
Kawhi wanted to buy t-shirts that he could customize and sell for a profit. Steph manufactured plain white t-shirts that seemed to be of high quality
  Kawhi wanted to buy t-shirts that he could customize and sell for a profit. Steph manufactured plain white t-shirts that seemed to be of high quality. Steph ordinarily sold the t-shirts for $5 each, but he told Kawhi that he would give him a deal if he ordered a large volume. Kawhi said he thought that would work for him, and he looked forward to doing business with Steph. Three days later Kawhi emailed Steph an order for 1,000...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT