Calculate the breakeven quantity

Assignment Help Financial Management
Reference no: EM131323145

A software firm has fixed costs of $800,000 and variable costs of $12 per unit. Calculate the breakeven quantity (Q) when each unit sells for $50. If the firm sells 50,000 units in a year, what is its profit for that year? Assume the tax rate for the firm is 20 percent.

Reference no: EM131323145

Questions Cloud

Chronic effect of sleep loss : Identify one (1) acute and one (1) chronic effect of sleep loss that could impact the RN's health, and describe precautions you would suggest to prevent the problems.
Encompass for the company website : For each process you select, explain what the process would encompass for the company's website and why the process is critical for both the company and the online customer.
Does the contract cover the 6 elements of a valid contract : A seller put up two engine analyzers for sale by auction, with no reserve. The price of the machines would have been £14,521 each if they had been new. The plaintiff was a bidder at the auction. He bid £200 for each machine, and was the highest bi..
Preliminary literature review and an action item checklist : Listed below including the Rubric. This assignment comprises two sections: a preliminary literature review and an action item checklist. Preliminary Literature Review:
Calculate the breakeven quantity : A software firm has fixed costs of $800,000 and variable costs of $12 per unit. Calculate the breakeven quantity (Q) when each unit sells for $50. If the firm sells 50,000 units in a year, what is its profit for that year? Assume the tax rate for the..
Find the range of optimality for the profit coefficient : Determine the optimal mix of products in terms of maximizing contribution to profits for the period. Then, find the range of optimality for the profit coefficient of each variable.
Describe a control strategy for a resolution : If all of the statements in a PROLOG program were con-verted to disjunction of literals, describe a control strategy for a resolution refutation system that performs the same resolutions as does the PROLOG in-terpreter.
Provide brief introduction to australian financial system : Provide a brief introduction to the Australian financial system, the main financial institutions and the financial markets in Australia and preview what will be presented in the report.
Current assets and current liabilities : The Nelson Company has $1,160,000 in current assets and $400,000 in current liabilities. Its initial inventory level is $320,000, and it will raise funds as additional notes payable and use them to increase inventory. How much can Nelson's short-term..

Reviews

Write a Review

Financial Management Questions & Answers

  There are also call options on the company stock

Deeble Construction Co.’s stock is trading at $30 a share. There are also call options on the company’s stock, some with an exercise price of $25 and some with an exercise price of $35. All options expire in three months. Which of the following best ..

  Calculate the holding period return on a before-tax basis

"Mary and Nick Stalcheck have an investment portfolio containing 4 investments. It was developed to provide them with a balance between current income and capital appreciation. Calculate the holding period return on a before-tax basis for each of the..

  Refurbishing one of its hotels at cost

Hathaway, Inc., a resort company, is refurbishing one of its hotels at a cost of $6,794,207. Management expects that this will lead to additional cash flows of $1,560,000 for the next six years. What is the IRR of this project? Should the Firm accepr..

  What are capital expenditures

What are capital expenditures, and how can they help a company achieve its long-term objectives?

  Stock is expected to pay dividend

A stock is expected to pay a dividend of $1.75 the end of the year (that is, D1 = $1.75), and it should continue to grow at a constant rate of 10% a year. If its required return is 14%, what is the stock's expected price 4 years from today? Round you..

  Markets for housing in tempe and california are efficient

Jim Green’s father-in-law, who lives in California, would like Jim to move out from Tempe to California so he could see his grandchildren more often. Jim Green argues that housing is too expensive in California. Spouse’s pop responds: Does Jim Green’..

  Use Goal Seek in order to find this rate of return

Assume “Jane” saves $10,000 per year for 10 years starting at age 25. At age 35 she no longer is able to save but leaves her accumulated savings invested until age 65 when she retires.  At what assumed rate of return are John and Jane’s wealth at age..

  What will be the after-tax cash flow of this sale

Suppose you sell a fixed asset for $123,000 when its book value is $143,000. If your company’s marginal tax rate is 40 percent, what will be the effect on cash flows of this sale (i.e., what will be the after-tax cash flow of this sale)?

  Complete put–call parity formula for stock-debt and assets

Digital Organics has 11.1 million outstanding shares trading at $36 per share. It also has a large amount of debt outstanding, all coming due in one year. The debt pays interest at 9%. It has a par (face) value of $339 million, but is trading at a ma..

  Target capital structure-cost of common equity

Percy Motors has a target capital structure of 30% debt and 70% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 10%, and its tax rate is 40%. Percy's CFO estimates that the company's WACC is 13.60%...

  Perform a breakeven analysis

The Lade & Bach Company produces office chairs. The price of the chairs is $99.75 and the variable cost per chair is $49.75. The following fixed costs are incurred: What is the breakeven point in number of chairs? How many chairs must be sold for the..

  Payoff as a piece-wise function of the price of the stock

Suppose an investor purchases 100 shares of a stock selling at $50 per share, 100 put options on the stock with exercise price $40 and writes 100 calls on the stock with exercise price $60. Suppose no premium is paid when purchasing a put or writing ..

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