Ray Corp. wants to produce and sell a new portable radio. Desired profit per unit is $2. The expected unit sales price is $20 based on 10,000 units. What is the total target cost? Question 6 options: $180,000 $209,000 $ 200,000 $20,000

Baghiben

A new project will allow you to sell a new product at $61 each. Variable costs are $24 each and fixed costs would run $75,000 per year. If there is no initial investment required, how many units would you have to sell annually to break-even (aka the "accounting break-even quantity")? (Round up to the next whole number of units.) O a. 1800 O b. 2147 O c. 2287 O d. 1778 Oe. 2028

Q.1.

Assume that a company plans to introduce a new product to the market at a target selling price of $20 per unit. It is investing $4,000,000 to purchase the equipment needed to produce and sell 250,000 units per year. Assuming the company’s required rate of return on all investments is 16.50%, what is the new product’s target cost per unit? Multiple Choice   $21.84   $22.84   $18.36   $17.36

4 Hang Coffee uses high-end coffee roasting machines that cost $30,000 to purchase plus $5,000 per year to operate. The machines have a four-year life, after which they are worthless. What is the equivalent annual cost of one these machines if the required return is 18 percent? $16,550 O $10,863 O $11,152 O $16,152 O $12,500

QUESTION 1 Agro Tech Corporation is considering investing in a new IT system for selling to its clients. The company has identified two new possible systems, which would be suitable for its customers. Only one of the systems can be selected and the directors are looking for guidance on which system would be the best. The company requires a 15% rate of return on projects of this nature. The installation cost per project will be R100 000 each, while systems can be disposed for R200 000 each after five- years life span. Cash flows for Agro Tech Corporation: IT System (Rands) PERIOD 1 2 3 4 5 SYSTEM A -4 000 000 R1 800 000 R1 700 000 R1 600 000 R1 500 000 R1 400 000 SYSTEM B -3 500 000 1 500 000 1 500 000 1 500 000 1 400 000 R1 300 000 Required: 1.1 Determine the payback period in years, months and days for both systems 1.2 Based on your calculations in 1.1, which system should Agro Tech Corporation consider? Why? 1.3 Calculate the Net Present Value for both systems. 1.4 Calculate the…

Problem 4. Which project would you select on the basis of rate of return, assuming MARR =15%. Please use excel spreadsheet to answer.

We project unit sales for a new household-use laser-guided cockroach search and destroy system as follows: Year 12345 Unit Sales 101,000 113,000 136,000 142,000 95,000 The new system will be priced to sell at $475 each. The cockroach eradicator project will require $2,200,000 in net working capital to start, and total net working capital will rise to 15% of the change in sales. The variable cost per unit is $345, and total fixed costs are $2,500,000 per year. The equipment necessary to begin production will cost a total of $22 million. This equipment is mostly industrial machinery and thus qualifies for CCA at a rate of 20%. In five years, this equipment will actually be worth about 20% of its cost. The relevant tax rate is 35%, and the required return is 17%. Based on these preliminary estimates, what is the NPV of the project? (Enter the answer in dollars. Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.) NPV A

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