Computer the margin of safety

Assignment Help Finance Basics
Reference no: EM1358481

Embleton Company estimates that variable costs will be 40% of sales, and fixed costs will total $900, 000. The selling price of the product is $5.

a. Compute the break-even point in (1) units and (2) dollars.1
b. Computer the margin of safety in (1) dollars and (2) as a ratio, assuming actual sales are $2 million.

 

Reference no: EM1358481

Questions Cloud

Compute average annual rate of return : Suppose you are considering how to finance your child's college education. The child is 3 years old now so there are 15 years to go before your child enters college at age eighteen.
Supply chain - relationship management : Show why relationship management is so important in managing the supply chain. Provide examples of why building, and maintaining these relationships is important.
Cultures in regards to adhd : What are the similarities and differences across countries, cultures in regards to ADHD.
What fraction of the initial kinetic energy : A 2100 kg car traveling to the right at 32m/s is chasing a second car of the same mass that is traveling to the right at 10m/s.
Computer the margin of safety : Embleton Corporation estimates that variable costs will be 40 percent of sales, and fixed costs will total $900, 000. The selling price of the product is $5.
Overprescribe medication for adhd : Do you believe doctors overprescribe medication for ADHD? Explain your answer.
Construct and dfa or lr items for grammar : Consider the following grammar: S S (S) | ε. Construct and DFA or LR(0) items for this grammar. Construct SLR(1) parsing table.
Illustrate what has happened to the value of the dollar : Illustrate what has happened to the value of the dollar. Illustrate what are the comapny's hourly labor costs in dollars at both exchange.
Decision making question : Ben Bates graduated from college 6-years ago with a finance undergraduate degree. Although he is satisfied with his current job, his aim is to become and investment banker.

Reviews

Write a Review

Finance Basics Questions & Answers

  Computing present value of a lump-sum

Use present value table to find out the amount of cash that Mr. Gulliver's father should give him. Use algebraic formula to prove that the present value of trust fund (the amount of cash computed in requirement a) is equal to its $60,000 future val..

  Bond pricing factors and direction of response

Write down the three factors that cause a bond's price to change and what is the predicted direction of change for the bond's price from changes in these factors?

  Selection of expected return by rational investor

Investment A has an expected return of 15 percent per year, while investment B has an expected return of 12 percent per year.

  Federal reserve change

Dicuss and explain three ways in which the Federal Reserve can change the money supply. If the Federal Reserve is going to adjust all of these tools during an economy that is growing too quickly, what changes would they make?

  Creating portfolio with expected risk free rate of return

What are some methods to create a portfolio with the expected risk free rate of return? Think of putting two stocks into a portfolio.

  Present value of multiple cash flows

Seaborn Co. has identified investment project with following cash flows. If the discount rate is 10 percent, what is present value of these cash flows? What is present value at 18% ? At 24%?

  Determine the financial goals

I am a man trying to get muscular; help me to write about how I am going to get in shape to be muscular in the next 2-years by working on my arms, legs and stomach.

  Calculate the 6 monthly discount factors

Calculate the 6 monthly discount factors D(t) and the semi-annual zero coupon rates z(t), where t = 0.5, 1, 1.5, ., 9.5, 10. (2) Using the discount factors derived in (1), calculate the price of a 4½ year semi-annual coupon bond with an annual coupon..

  Compute margin of safety

A corporation makes a single product that it sells for $18 a unit. Fixed costs are $76,000 per month and the product has a contribution margin ratio is 40 percent.

  Decision making models and preferred stock

Given two projects, what are the decision models that you can use to make a decision as to which project you should accept? Which is the better?

  Explain role of market efficiency in underpricing theories

One method utilized by corporation to obtain the long-term capital necessary to run & grow their businesses is by providing the general public with the option to buy stocks.

  Determine afn for the coming year

Chua Chang & Wu Corporation is considering its operations for next year, and the CEO wants you to forecast the firm's additional funds needed. Information for use in your forecast are shown below. Based on the AFN equation.

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