Question
In: Accounting
CableVision has been approached by the City of Mirada to run its cable operations in 2019....
CableVision has been approached by the City of Mirada to run its cable operations in 2019. After negotiating with key parties,CableVision has made the following agreements:
- It will offer Mirada residents a basic set of 25 cable television stations at a rate of $33.99 per month.
- It will pay the city $90,000 per month plus $2.50 per cable subscriber per month to maintain the physical facilities.
- It will actually pay another company an annual fixed fee of $760,000 plus $8.75 per cable subscriber per month to broadcast the 25 channels.
CableVision estimates that operating costs for billing, program news mailings, etc. will be $125,000 per month plus 7% of monthly revenue.
CableVision has several questions about its monthly revenues, costs, and profits in 2019.
Part A
1. What is the estimated monthy contribution margin per cable
subscriber for CableVision in 2019? (20.36)
2. What are the estimated total monthly fixed costs for CableVision in 2019? (278,333)
Part B
1. What is CableVision's estimated monthly operating income in 2019 if 16,000 residents subscribe? (47,427)
2. How many monthly subscribers would be required for CableVision to break even in 2019? (13,670)
3. How many monthly subscribers would be required for CableVision to earn $23,000 per month in 2019? (14,800)
4. Assuming a tax rate of 31%, how many monthly subscribers would be required for CableVision to earn $23,000 per month in 2019?
Part C
Some of CableVision's managers are uncertain about their estimate of monthly fixed operating costs. Assuming that 21,000 residents subscribe, how large can monthly fixed operating costs be for CableVision to still earn $23,000 per month in 2019 (ignore taxes)?
Just Part B question 4 and Part C Please.. I need it ASAP
Solutions
ekkarill92 answered 11 months agoRelated Solutions
CableVision has been approached by the City of Mirada to run its cable operations in 2019....
CableVision has been approached by the City of Mirada to run its
cable operations in 2019. After negotiating with key parties,
CableVision has made the following agreements:
It will offer Mirada residents a basic set of 25 cable
television stations at a rate of $33.99 per month.
It will pay the city $110,000 per month plus $4.00 per cable
subscriber per month to maintain the physical facilities.
It will actually pay another company an annual fixed fee of
$760,000 plus...
CableVision has been approached by the City of Mirada to run its cable operations in 2019....
CableVision has been approached by the City of Mirada to run its
cable operations in 2019. After negotiating with key parties,
CableVision has made the following agreements:
It will offer Mirada residents a basic set of 25 cable
television stations at a rate of $29.99 per month.
It will pay the city $1,300,000 per year plus $3.25 per cable
subscriber per month to maintain the physical facilities.
It will actually pay another company a monthly fixed fee of
$70,000 plus...
The average monthly cable bill in 2016 has been reported to be $92. Assume monthly cable...
The average monthly cable bill in 2016 has been reported to be
$92. Assume monthly cable bills follow a normal distribution with
a standard deviation of $9.50.
a. What is the probability that a randomly selected bill will
be
1. less than $90?
2. less than $100?
3. exactly $100?
4. between $85 and $95?
Which monthly cable bill represents the 55th percentile?
Coyote Cable has been experiencing an increase in cable service subscribers in recent months due to...
Coyote Cable has been experiencing an increase in cable service
subscribers in recent months due to increased advertising and an
influx of new residents to the region. The number of subscribers
(in 1000s) for the last 16 months is as follows:
Month
Sales
1
9.8
2
10.6
3
12.2
4
12.1
5
12.8
6
15.2
7
17.6
8
14.5
9
15.9
10
19.6
11
22.2
12
20.8
13
23.1
14
21.7
15
23.5
16
25.9
a. ) What is...
Cable Corp. has entered into a transaction with Land Corp. Cable Corp will give its equipment...
Cable Corp. has entered into a transaction with Land Corp. Cable
Corp will give its equipment to Land Corp. in exchange for Land’s
equipment. Cable Corp will also pay Land Corp $30,000 cash. Cable
Corp’s equipment originally cost $160,000 when it was purchased 2
years ago and currently has $50,000 of accumulated depreciation and
an estimated fair value of $122,000. The fair value of Land Corp’s
equipment is determined to be $152,000.
Required:
Provide the journal entry to record this...
NYNEX, the phone utility for the New York City area, has approached you for advice on...
NYNEX, the phone utility for the New York City area, has
approached you for advice on its capital structure. In 1995, NYNEX
had debt outstanding of $12.14 billion and equity outstanding of
$1.7 billion and faced a corporate tax rate of 36%. The beta for
the stock is 0.84, and the bonds are rated A - (with a market
interest rate of 7.5%). The probability of default for A-rated
bonds is 1.41%, and the bankruptcy cost is estimated to be...
You are a consultant who has been approached by a company about to embark on a...
You are a consultant who has been approached by a company about
to embark on a project (identify any project of your choice). The
client would like to prepare a document to be used for the purposes
of ‘selling’ the project to potential financiers. Prepare an
information memorandum for the project to be presented to the
potential financiers. Among others it should contain the following:
1. The full business description of the project. 2. An analysis of
the key risks...
You are a consultant who has been approached by a company about to embark on a...
You are a consultant who has been approached by a company about
to embark on a project (identify any project of your choice). The
client would like to prepare a document to be used for the purposes
of ‘selling’ the project to potential financiers.
Prepare an information memorandum for the project to be
presented to the potential financiers. Among others it should
contain the following:
The full business description of the project.
An analysis of the key risks facing the...
A field density test has been run on a soil containing 18% of its weight in...
A field density test has been run on a soil containing 18% of
its weight in particles retained on the No. 4 sieve. The dry
density of the total sample was 128.7 pcf and the water content was
7%. The water content of the gravel fraction was 3%. the specific
gravity of the solids was 2.69. Compute the water content and dry
density of the soil fraction of the fill that passes the No. 4
sieve.
The city maintains a landfill that has been recorded during the current year within its parks....
The city maintains a landfill that has been recorded during the
current year within its parks. The landfill generated program
revenues of $4,000 in Year 4 and cash expenses of $15,000. It also
paid $3,000 cash for a piece of land. These transactions were
recorded as would have been anticipated, but no other recording was
made this year. The city assumes that it will have to pay $200,000
to clean up the landfill when it is closed in several years....
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Suppose a company is looking to hedge a risk in the derivatives market. What, fundamentally, is...
- Training and Development assignment. Describe the usage of Computer Based Training (CBT) in McDonald's Company training...
- PUT IN JAVA PROGRAMMING LANGUAGE The Rectangle class: Design a class named Rectangle to represent a...
- Journal article summary on inter-group conflict Peer Reviewed Journal article from past 3 years. Please include...
- "Ethical Considerations" Please respond to the following: Reflect upon the responsibilities placed on auditors by the...
- A Japanese company has a bond outstanding that sells for 93 percent of its ¥100,000 par...
- What is the difference among the principles of modularization, abstraction, encapsulation, and separation of interface and...
ADVERTISEMENT