You estimate that your cattle farm will generate $0.30 million of profits on sales of $6 million under normal economic conditions andthat the degree of operating leverage is 4.a. What will profits be if sales turn out to be $4.5 million?Note: Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Enter youranswers in millions.Profitwill✔ Answer is complete and correct.Profit willdecreaseto $b. What will profits be if sales turn out to be $7.5 million?Note: Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place.0✔ million.tomillion.

Cost-Volume-Profit (CVP) analysis helps businesses understand how changes in costs, volume, and…

Answered: You estimate that your cattle farm will…

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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Use the following information for the Quick Study below. (Algo) [The following information applies to the questions displayed below.] Following is information on an investment in a manufacturing machine. The machine has zero salvage value. The company requires a 6% return from its investments. Initial investment Net cash flows: Year 1 Year 2 Year 3 Year 1 Year 2 Year 3 QS 24-19 (Algo) Net present value with unequal cash flows LO P3 Compute this machine's net present value. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round all present value factors to 4 decimal places. Round present value amounts to the nearest dollar.) Totals Initial investment Net present value Net Cash Flow $ $ $ (240,000) 195,000 90,000 103,000 388,000 195,000 90,000 103,000 Present Value Factor Present Value of Net Cash Flows $ $ 0 0
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1 We learned how to use the Scenario Manager to view the results of a model when multiple 2 assumptions are changed. Using the Assumptions below, build the pro forma (in yellow) model and then run the 3 Scenarios using the the inputs in green below the pro forma. Your answer should show the After Tax Profits per Year (Summary range should be B25:F25). 4 5 6 Assumption 7 Tax Rate 8 Unit Sales 9 Sales Growth 10 Year 1 Price 11 Year 1 Cost 12 Cost Growth Rate 13 Price Growth Rate 14 15 16 17 Unit Sales 18 unit price 19 unit cost 20 21 Revenues 22 Costs 23 Before Tax Profits 24 Tax 25 After Tax Profits 26 27 28 Scenario 29 Accelerated Growth 30 Sustainable Growth 31 Moderate Growth 32 Moderate Decline 33 Accelerated Decline 34 35 Range name taxes Year1 units salesgrowth Year1 price Year1 cost costgrowth pricegrowth 1 200,000 $75.00 $60.00 $0 $0 Unit Sales 300,000 250,000 225,000 180,000 165,000 18.0% 200,000 3.5% $75.00 $60.00 2 3.0% 5.0% $0 $0 Year 3 $0 $0 Sales Growth Cost Growth 10.0%…
An ongoing business should be able to produce cash flows as listed below. It's offered for sale at a price of $1.5 million, and most interested buyers understand the current owner will unlikely accept anything less. If an appropriate opportunity cost of money is 9.0%, what is the value of this business for anyone who buys today from the owner? • Year 1 - $305,000 Year 2 $327,000 ● ● ● ● Year 3- $348,500 Year 4- $385,000 Year 5 - $422,000
Kate is considering expanding and bringing in several employees. To do this she will need a larger facility and to purchase more equipment. Which means additional financing. Answer this: look at the financial statements as if you were a banker considering her for a loan comment on your findings and use calculations to support your answer.
Please document any AJEs you do here. Show the calcs / reasoning and then input them into the next tab.
Assume the following: • A company is importing and selling Mercedes cars. • An Islamic bank invests US$8 million for an 80% profit share. • An investor invests US$2 million for a 20% profit share. • The investor is to be paid a 10% management fee as percentage of profit after expenses. • Sale proceeds = US$12,400,000 Expenses = US$200,000 Calculate the following: 1.1. The total return to the bank: 1.2. The total return to the investor:
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Your personal banker added a clause in the contract. To be entitle for the loan, the business should yield a positive NPV. To set up the business, you will be required to purchase an equipment costing Rs 60,000.00. You expect inventory will increase by Rs 18,000.00 and accounts payable will increase by Rs5000.00. All the other working capital components will stay the same. So the change in net operating working capital is Rs 13,000.00 at t=0. You expect to keep the company for 4 years and you expect to sell 20,000.00 units of peanut butter at a unit price of Rs35.00 and believe that both prices and quantity will remain the same. The fixed cost is Rs 7,000 every year and variable costs will be Rs1.03 per unit. You plan to use the straight- line depreciation and the equipment will be fully depreciated after 4 years. The salvage value is Rs24, 000 and tax rate is 23% 1. What are the incremental cash flows for the 4 years 2. If the WACC is 11%, will you get the loan?
After a successful year for your beach shop, you are wondering whether to open one more store this year. There are equal chances for the coming summer to be rainy or sunny. If the weather is sunny, you will earn $90,000 in profits per store. However, if the weather is rainy, your profit will be $60,000 if you open one store and zero if you open two stores. What is your expected profit under complete information? O A. $75,000 O B. $180,000 OC. $150,000 O D. $120,000
Please solve question 2 with excel function PV, thanks
Suppose that you are the manager of a studio cafe, and you are planning to invest on a new camera and a coffee maker designed to increase the productivity of your employees and output (services) produced. Your analyst provided you the following information: A. Complete the table below. Should the new camera and coffee maker be purchased? Explain your answer based on the incremental analysis.

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