The pretax operating cash flow of Sandhill Motors declined so much during the recession of 2008 and 2009 that the company almost defaulted on its debt. The owner of the company wants to change the cost structure of his business so that this does not happen again. He has been able to reduce fixed costs from $489,000 to $304,000 and, in doing so, reduce the Cash Flow DOL for Sandhill Motors from 3.1 to 2.4 with sales of $1,070,000 and pretax operating cash flow of $230,000. If sales declined by 30 percent from this level, how much more pretax operating cash flow would Sandhill Motors have with the new cost structure than under the old? (Round answer to nearest whole dollar, e.g. 5,275.) dhill Motors would have $ more pretax operating cash flow with the new cost structure than under the old

The pretax operating cash flow of Sandhill Motors declined so much during the recession of 2008 and 2009 that the company almost defaulted on its debt. The owner of the company wants to change the cost structure of his business so that this does not happen again. He has been able to reduce fixed costs from $489,000 to $304,000 and, in doing so, reduce the Cash Flow DOL for Sandhill Motors from 3.1 to 2.4 with sales of $1,070,000 and pretax operating cash flow of $230,000. If sales declined by 30 percent from this level, how much more pretax operating cash flow would Sandhill Motors have with the new cost structure than under the old? (Round answer to nearest whole dollar, e.g. 5,275.) dhill Motors would have $ more pretax operating cash flow with the new cost structure than under the old

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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