Stinnett Transmissions, Incorporated, has the following estimates for its new gear assembly project: Price $1,260 per unit; variable cost $480 per unit; fixed costs $4.99 million; quantity = 89,000 units. Suppose the company believes all of its estimates are accurate only to within ±22 percent. What values should the company use for the four variables given here when it performs its best- case and worst-case scenario analysis? Note: Do not round Intermediate calculations and enter your answers in dollars, not millions of dollars, rounded to the nearest whole number, e.g., 1,234,567. Scenario Unit Sales Base case 89,000 $ Best case Worst case Unit Price Unit Variable Cost Fixed Costs 480 $ 4,990,000 1,260 $

Stinnett Transmissions, Incorporated, has the following estimates for its new gear assembly project: Price $1,260 per unit; variable cost $480 per unit; fixed costs $4.99 million; quantity = 89,000 units. Suppose the company believes all of its estimates are accurate only to within ±22 percent. What values should the company use for the four variables given here when it performs its best- case and worst-case scenario analysis? Note: Do not round Intermediate calculations and enter your answers in dollars, not millions of dollars, rounded to the nearest whole number, e.g., 1,234,567. Scenario Unit Sales Base case 89,000 $ Best case Worst case Unit Price Unit Variable Cost Fixed Costs 480 $ 4,990,000 1,260 $

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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For each situation below, determine (a) if the variable is discrete or continuous and (b) if the information involves certainty or risk.(1) The first cost of a new front-end loader is $34,000 or $38,000 depending on the size purchased.(2) The raises for engineers and technical staff employees will be 3%, or 5%, with half getting 3% and half getting 5%.(3) Revenue from a new product line is expected to be between $350,000 and $475,000 per year with a larger chance that it is low in the range.(4) The salvage value for an old machine will be $500 (the asking price) or $0 (it will be scrapped), depending upon who is selected by the manager to take it.(5) Profits are expected to be up by anywhere between 25% and 60% this year, with equal probability for all estimates.
A firm is considering two location alternatives. At location C, fixed costs would be $5,000,000 per year, and variable costs $0.25 per unit. At alternative D, fixed costs would be $4,500,000 per year, with variable costs of $0.35 per unit. If annual demand is expected to be 4.5 million units, which plant offers the lowest total cost? Select one: O a. Plant C, because Plant C is cheaper than Plant D for all volumes. O b. Plant D, because Plant D is cheaper than Plant C for all volumes below 5 million units. Oc. Neither Plant C nor Plant D, because the crossover point is at 4.5 million units. O d. Plant D, because Plant D is cheaper than Plant C for all volumes. Oe. Plant C, because Plant C is cheaper than Plant D for all volumes below 5 million units.
please give me the right answer i am not sure about my answer ASAP please
A special project is going to be started by Hally Corporation.Company is considering using stocks of an old raw material in aspecial project. The special project would require all 230kilograms of the raw material that are in stock and that originallycost the company $900 in total. If the company were to buy newsupplies of this raw material on the open market, it would cost$8.25 per kilogram. However, the company has no other use forthis raw material and would sell it at the discounted price of $7.50per kilogram if it were not used in the special project. The sale ofthe raw material would involve delivery to the purchaser at a totalcost of $50 for all 230 kilograms. What is the relevant cost of the230 kilograms of the raw material when deciding whether toproceed with the special project?
Currently, the unit selling price of a product is $1,500, the unit variable cost is $1,200, and the total fixed costs are $4,500,000. A proposal is being evaluated to increase the unit selling price to $1,600. Compute the current break-even sales (units).Answer Check Figure: 15,000 units Compute the anticipated break-even sales (units), assuming that the unit selling price is increased to the proposed $1,600, and all costs remain constant.
Acadia Logistics anticipates that it will need more distribu-tion center space to accommodate what it believes will bea significant increase in demand for its final-mile services.Acadia could either lease public warehouse space to coverall levels of demand or construct its own distribution centerto meet a specified level of demand, and then use publicwarehousing to cover the rest. The yearly cost of buildingand operating its own facility, including the amortized costof construction, is $12.00 per square foot. The yearly cost ofleasing public warehouse space is $20.00 per square foot. Theexpected demand requirements follow: a. Calculate the expected value of leasing public warehousespace as required by demand.b. Calculate the expected value of building a 200,000-square-foot distribution center and leasing public warehousespace as required if demand exceeds the need for 200,000square feet of space.c. Calculate the expected value of building a 300,000-square-foot distribution center and…
Currently the unit selling price of a product is $200, the unit variable cost is $110, and the total fixed costs are $585,000. A proposal is being evaluated to increase the unit selling price to $275. Under the proposed plan, the variable cost per unit and the total fixed cost will not change. 1) Calculate the contribution margin per unit. 2) Calculate the contribution margin ratio. 3) Calculate the breakeven point in units under the current scenario.
please give me an accurate answer please for all
3 )
Briefly review the sensitivity analysis that is presented in the case exhibits. Under what circumstances is this project financially attractive? What bets were the company making when they went ahead with the project? DO NOT HAVE TO PERFORM YOUR OWN SENSITIVITY ANALYSIS. YOU ARE TO INTERPRET THE SENSITIVITY ANALYSIS THAT IS GIVEN.
Management believes it can sell a new product for $9.00. The fixed costs of production are estimated to be $7,000, and the variable costs are $3.40 a unit. Complete the following table at the given levels of output and the relationships between quantity and fixed costs, quantity and variable costs, and quantity and total costs. Round your answers to the nearest dollar. Enter zero if necessary. Use a minus sign to enter losses, if any. Quantity Total Revenue Variable Costs Fixed Costs Total Costs Profits (Losses) 0 $ $ $ $ $ 500 $ $ $ $ $ 1,000 $ $ $ $ $ 1,500 $ $ $ $ $ 2,000 $ $ $ $ $ 2,500 $ $ $ $ $ 3,000 $ $ $ $ $ Determine the break-even level using the above table and use the Exhibit 19.5 to confirm the break-even level of output. Round your answers for the break-even level to the nearest whole number. Round your answers for the fixed costs, variable costs, total costs,…

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