Break-even analysis

Assignment Help Financial Management
Reference no: EM13976206

Break-even analysis [LO2]

The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $35 and has a variable cost of $22. There are $97,500 in fixed costs involved in the production process.

a. Compute the break-even point in units.

Break-even point units = ____________

b. Find the sales (in units) needed to earn a profit of $262,500. (Round your answer to the nearest whole number.)

Sales quantity needed unitsc = ___________

Reference no: EM13976206

Questions Cloud

Use the spot market in foreign exchange : Consider the following situation: a firm based in the U.S. opens two storefronts in a Chinese town. The area has several million people. The storefronts are quite large and offer local products as well as imports from other countries. How would the U..
The net present value of a projects cash inflows : The net present value of a project's cash inflows is $12,933 at a 11.2 percent discount rate. The profitability index is 1.55 and the firm's tax rate is 26 percent. What is the initial cost of the project?
Calculate total number of copies that publisher expects : Your finance text book sold 47,500 copies in its first year. The publishing company expects the sales to grow at a rate of 20.0 percent for the next three years, and by 14.0 percent in the fourth year. Calculate the total number of copies that the pu..
Cash break-even analysis : Air Purifier Inc. computes its break-even point strictly on the basis of cash expenditures related to fixed costs. Its total fixed costs are $2,450,000, but 15 percent of this value is represented by depreciation. Its contribution margin (price minus..
Break-even analysis : The Hartnett Corporation manufactures baseball bats with Pudge Rodriguez’s autograph stamped on them. Each bat sells for $35 and has a variable cost of $22. There are $97,500 in fixed costs involved in the production process. Compute the break-even p..
Execute locational arbitrage : Assume the bid rate of the Singapore dollar (SGD) is $0.3300, while the ask rate is $0.3350 at Bank A. Assume the bid rate for the SGD at Bank B is 0.3200, while the ask rate $0.3250. Given this information, what would be your gain if you use $1,000,..
Internal rate of return discounts all negative cash flows : The discounting approach to the modified internal rate of return discounts all negative cash flows back to the present and combine them with the initial cost. You are using a net present value profile to compare projects A and B, which are mutually e..
What is the net present value of this investment : You are making a $35,000 investment and feel that a 10.6 percent rate of return is reasonable given the nature of the risks involved. You feel you will receive at least $8,000 in the first year, $27,000 in the second year, $32,000 in the third year, ..
Calculate the cost of capital : A project which has an operational phase of 5 years and requires an initial investment of 100K $ and generate cash flow of 50K $ every year of the operational phase. Calculate the cost of capital.

Reviews

Write a Review

 

Financial Management Questions & Answers

  What is its economic value added

Barnes' Brothers has the following data for the year ending 12/31/15; Net income = $600; Net operating profit after taxes (NOPAT) = $700; Total assets = $2,500; Short-term investments = $200; Stockholders' equity = $1,800; Total debt = $700; and Tota..

  Target debt-equity ratio and cost of debt

Lannister Manufacturing has a target debt−equity ratio of .45. Its cost of equity is 13 percent, and its cost of debt is 7 percent. If the tax rate is 34 percent, what is the company’s WACC?

  Determine the maximum amount he could withdraw in year one

A man want to deposit $50,000 now and $60,000 at the end of six years in a bank that pays 12% interest compounded semi annually. He wants to withdraw an amount every year for the first six years and to withdraw exactly $1,500 more for the following f..

  Per value bond will exceed the bonds yield to maturity

The current yield on a par value bond will exceed the bond's yield to maturity. A premium bond has a current yield that exceeds the bond's coupon rate. The yield to maturity on a premium bond exceeds the bond's coupon rate.

  Laws governing qualified retirement plans

An employer suggested to provide the following vesting schedules. Determine if these schedules comply with the laws governing qualified retirement plans [explain]:

  How much is the company behind in preferred dividends

National Health Corporation (NHC) has a cumulative preferred stock issue outstanding, which has a stated annual dividend of $8 per share. The company has been losing money and has not paid preferred dividends for the last five years. How much is the ..

  Calculations if investors were ahead after advance or not

From October 2007 to March 2009, the market declined about 57%. It then advanced in 1 year about 69%. Determine by calculations if investors were ahead after the advance or not?

  Cost of capital estimate deviate to change the decision

Fast Track Bikes, Inc. is thinking of developing a new composite road bike. Development will take six years and the cost is $196,900 per year. Once in production, the bike is expected to make $291,055 per year for 10 years. The cash inflows begin at ..

  What are the net proceeds to the firm

Raybac is about to go public. Its present stockholders own 470,000 shares. The new public issue will represent 810,000 shares. The shares will be priced at $35 to the public with a 14% spread. The out-of pocket costs will be $580,000. What are the ne..

  Problem 1pre-contribution balance sheets and fair

problem 1pre-contribution balance sheets and fair valuesjune 30 20x9in thousands of

  What is the tax on this dividend income

Now assume that Wendt does not receive the interest income but does receive an Additional $1 million as dividends on some stock it owns. What is the tax on this dividend income?

  Boston red sox spring training decision case study

Using center of-gravity model, compute the center of gravity for the population of the county. Show all of your computations, explain, and justify. Based soley on this criterion, where is the best stadium location? Research and explain at least three..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd