ACG Manufacturing LtdStatement of comprehensive31/12/20X1£'000TotalUnit % New projectSales(1000units)250.000250 100VC150.000150 60CM100.000100 40FC60.000EBIT40.000Ex4: Prepare the I.S if:ACG replace paying fixed salary of £10,000/year by payingregarding to number of product sold at £20/unitEffect: Sales volume increase by 20%income as year ended at

Cost volume profit analysis or CVP analysis can be explained as a method of cost accounting that is…

Answered: ACG Manufacturing Ltd Statement of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A7
Lowell Inc. projects unit sales for a new project with a life of FOUR YEARS as follows: Year 1 2 3 Unit Sales 10,000 12,000 14,000 16,000 Production will require Lowell must have an amount of NOWC on hand equal to 9 percent of the upcoming year's sales. Total fixed costs are $100,000 per year, variable production costs are $230 per unit, and the units are priced at $300 each. The sale price and variable costs will increase by 2 percent every year. The equipment needed to begin production has an installed cost of $2,000,000. The equipment qualifies as 5-year MACRS property. Years 1 3 4 Depreciation rate 20% 32% 19% 12% In FOUR years, this equipment can be sold for about 21 percent of its acquisition cost. Lowell is in the 25 percent marginal tax bracket and has a required return on all its projects of 18 percent. Based on these preliminary project estimates, what is the IRR of the project? 17.17% 22.55% 11.40% 12.05%
What should be the unit selling price of its product to have a 20% return on investment? Baguio Corporation has these selected data: 25,000 P500,000 Units to be sold Total Cost of the units Fixed Capital investment Variable capital on sales 1,000,000 20%
Year Unit Sales 1 73,000 2 86,000 3 105,000 4 97,000 5 67,000 Production of the implants will require $1,500,000 in networking capital to start. It is expected that networking capital requirements are not changing over the life of the project. Total fixed costs are $3,300,000 per year,variable production costs are $225 per unit, and the units are priced at $375 each. The equipment needed to begin production has an installed cost of$16,500,000. Because the implants are intended for professional singers, this equipment is considered industrial machinery and thus qualifies as a seven-year MACRS property. In five years, this equipment can be sold for about 20 percent of the acquisition cost. The tax rate is 21 percent and the required returns is 18 percent. Based on these preliminary estimates, a) What is theNPV of the project? b) What is the IRR? USE EXCEL AND SHOW WORKING
QUESTION 20 Total Per unit Sales Revenue (30,000 units) $750,000 $25 Variable Costs A $450,000 $15 Contribution Margin $300,000 Fixed Costs $150,000 Operating Income $150,000 Now assume that this company's selling price per unit and variable cost per unit stay the same while total fixed costs increases by $100,000 per year. This company's breakeven point will: O increase O decrease remain the same
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What would be the total contribution to profit to the company as a whole for 10,000 units transferred to Division B and later sold to outside customers at P21 per unit. A. P20,000 B. P40,000 C. (P20,000) D. P80,000
Plant Cost $4,000,000 year 0 Sales (units) 80,000 year 1 Selling Price $25 each Sales Growth _ per year Variable Costs 40% of revenue SG&A 50% of revenue SG&A Declines 2% per year Depreciation 5 years, straight-line Tax Rate 35% What is the Sales Growth percentage that results in total net income closest to 0? Report your answer to the nearest 0.1%
given information Description Amount Sales $6,000,000 Net Operating Income $800,000 Average Operating Assets $10.000,000 A new project is available that is estimated to generate an additional $500,000 in sales with an additional $60,000 in income. The project would require an investment in additional equipment of $600,000. Using the original information (in the table) and this new project's information, what would the segment's new ROI be if the project is pursued? Profit Margin Asset Turnover ROI Based on the new ROI, would the company want to pursue the new project
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