14. Asset betas (S9.3) Which of these projects is likely to have the higher asset beta, other things equal? Why?a. The sales force for project A is paid a fixed annual salary. Project B's sales force is paid by commissions only.b. Project C is a first-class-only airline. Project D is a well-established line of breakfast cereals.

Asset beta is used to measure the risk associated with an asset or a project.The higher is the beta…

Answered: 14. Asset betas ($9.3) Which of these…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter12: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 12.4E

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The Miramar Company is going to introduce one of three new products: a Widget, a Hummer, or a Nimnot. The market conditions (favourable, Stable, or unfavourable) will determine the profit or loss the company realizes, as shown In the following payoff table: State of Nature Favourable Stable Unfavourable Product 0.2 0.7 0.1 $ $ $ Widget 120,000 70,000 -30,000 Hummer 60,000 40,000 20,000 Nimnot 35,000 30,000 30,000 Required: 1. Develop the opportunity loss table and compute the expected opportunity loss for each product. 2. Determine how much the firm would be willing to pay to a market research firm to gain better information about future market conditions.
Please answer these all.
3. CVP: Atlas Corp, has been asked to submit a bid on supplying underwater masks to Pandora. The company's current cost structure per mask is as follows: DM DL var. MOH var. SGA $9.00 $8.00 $7.50 $4.00 a. Assume that there would be no variable sales commission on this special order. Determine the lowest unit price that Atlas can bid without reducing its current level of operating income. b. Assume the company desires a 38 percent contribution margin ratio from this sale and that a special sales commission of 4 percent of the bid price will be applied to the order instead of its normal $4 variable sales commission. Determine the bid price per unit given these unique circumstances. c. Assume the product fixed costs are $180,000. How many units need to be sold to attain a profit of $249,000?
In today's fast-paced business environment, decision making is a critical task for managers. Making the right decisions is vital to the success of a company, and it requires access to relevant information. Cari Pump (CP) Company manufactures water pumps. An important part of the pump is its electronic component (EC). Cari Pump collects data with the following cost information about the costs of making ECs in 2019 and the expected costs in 2020: Current Costs (2019) Expected Costs (2020) Fixed manufacturing cost Fixed manufacturing overhead costs that can be avoided if ECs are not made Fixed manufacturing overhead costs of plant depreciation, insurance, and administration that cannot be avoided even if ECs are not made Variable manufacturing costs Direct material cost per EC Direct manufacturing labor cost per EC Variable manufacturing cost per batch for setups, Materials handling, and quality control 360,000 850,000 $ 200 60 2,000 360,000 850,000 $ 190 55 1,800
Requirement 1. If SnowDreams cannot reduce its costs, what profit will it earn? State your answer in dollars and as a percent of assets. Will investors be happy with the profit level? Complete the following table to calculate SnowDreams' projected income. Revenue at market price Less: Total costs Operating income
International Paper is trying to find the best paper rolling machine to maximize sales volume. There are three machine options: Machine A, Machine B, and Machine C. Annual revenue is expected to be at one of three possible levels, High, $6 million; Medium, $3 million; or Low, $2 million; but is impacted by machine selection as the probabilities show in the table below: High Revenue Medium Revenue Low Revenue Machine A .1 .3 .6 Machine B .4 .4 .2 Machine C .5 .4 .1 Which machine should International Paper purchase to maximize the expected revenue, and wh sthe expected revenue? Group of answer choices Machine A, $2.7 million Machine B, $4.0 million Machine B, S4.6 million Machine C, $4.4 million none of the answers provided are correct
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1. Should SS upgrade its production line or replace it? Show your calculations 2. Suppose the one-time equipment cost to replace the production equipment is negotiable.All other data are as given previously. What is the maximum one-time equipment cost that SSwould be willing to pay to replace the old equipment rather than upgrade it?
H1.
15. Project NPV (S6.3) A widget manufacturer currently produces 200,000 units a year. It buys widget lids from an Page 176 outside supplier at a price of $2 a lid. The plant manager believes that it would be cheaper to make these lids rather than buy them. Direct production costs are estimated to be only $1.50 a lid. The necessary machinery would cost $150,000 and would last 10 years. This investment could be written off immediately for tax purposes. The plant manager estimates that the operation would require additional working capital of $30,000 but argues that this sum can be ignored since it is recoverable at the end of the 10 years. If the company pays tax at a rate of 21% and the opportunity cost of capital is 15%, would you support the plant manager's proposal? State clearly any additional assumptions that you need to make.
Maximus Steel plans to introduce one of three new products code-named: Wren, Hawk, and Nightingale. The marketing department indicated that the success of any product depends on the market conditions (Favorable, Neutral, or Unfavorable). The profit the company will earn also depends on the market conditions. The table below shows the probability estimated for each market condition and the profits Maximus Steel will realize within those conditions: Product Code Market Conditions Favorable P = 0.2 Neutral P = 0.7 Unfavorable P = 0.1 Wren $120,000 $70,000 ($30,000) Hawk $60,000 $40,000 $20,000 Nightingale $35,000 $30,000 $30,000 Part 1 Instructions: Compute the expected value for each alternative. What is the best option for the company?
Pls help with below homework, answer in 5-6 sentence only.

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