Scenario analysis: Chip’s Home Brew Whiskey forecasts that if it sells each bottle of Snake-Bite for...

Scenario analysis: Chip’s Home Brew Whiskey forecasts that if it sells each bottle of Snake-Bite for $20, the demand for the product will be 15,000 bottles per year, Chip’s variable cost per bottle is $10, and the total fixed cash cost for the year is $100,000. Depreciation and amortisation charges are $20,000, and the company is in the 30 percent tax rate. The company anticipates an increased working capital need of $3,000 for the next year. At $20 per bottle the Chip’s FCF is ______$. Chip’s predicts sales will be 92 percent as high if the price is raised 13 percent. At the new price Chip’s FCF is ________$.

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Chip’s Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for...

Chip’s Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for $20, then the demand for the product will be 15,000 bottles per year. Whereas Sales will equal only 86 percent of this amount if the price is raised 15 percent. Chip’s variable cost per bottle is $10, and the total fixed cash cost for the year is $100,000. Depreciation and amortization charges are $20,000, and the firm has a 30 percent marginal tax rate....

A statistician is working for a beverage company who sells bottled water. Each bottle is supposed...

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Radio Stack sells a particular digital cameras for $500 each. Forecasts indicate the future demand for...

Radio Stack sells a particular digital cameras for $500 each. Forecasts indicate the future demand for these cameras to be fairly constant at an average rate of 250 cameras per year. Radio Stack purchases the cameras from the manufacturer who charges a delivery fee of $25 per order. Radio Stack calculates their inventory holding cost based on a 20 percent annual interest rate . a) Use the following pricing schedule to determine the size of the standing order. For quantities...

Welco Ltd specialises in the manufacture of dry cider. The 1-litre bottle sells for £3.00 each....

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6. The O’Brien Vineyards makes and sells an awarding Pinot Noir. Each bottle of Pinot Noir...

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1. What is the difference between scenario analysis and sensitivity analysis? How might you use each...

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EXERCISE 1. A shop sells home computers. The numbers of computers sold in each of five...

EXERCISE 1. A shop sells home computers. The numbers of computers sold in each of five successive years were as follows: Year (x) 1 2 3 4 5 Sales (y) 10 30 70 140 170 Draw a scatter diagram for the data Find the least squares regression line of y on x and fit it on you scatter plot The shop manager uses this regression line to predict the sales in the following (i.e. the 6th) year. Find the predicted...

Exercise 5-22 CVP analysis using composite units LO P4 Handy Home sells windows and doors in...

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P4-15 (similar to) Multiple cash budgetslong dash—Scenario analysis Brownstein, Inc., expects sales of $101,000 during each...

P4-15 (similar to) Multiple cash budgetslong dash—Scenario analysis Brownstein, Inc., expects sales of $101,000 during each of the next 3 months. It will make monthly purchases of $56,000 during this time. Wages and salaries are $ 10,000 per month plus 6 %of sales. Brownstein expects to make a tax payment of $25,000 in the next month and a $19,000 purchase of fixed assets in the second month and to receive $8,000 in cash from the sale of an asset in...

FMEA (Failure Mode and Effect Analysis) Smelly Gus’s Gas Station sells gasoline. Each non-diesel station carries...

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