Use as the annual sales figure when evaluating this project

Assignment Help Financial Management

Reference no: EM13919346

Winnebagel Corp. currently sells 29,000 motor homes per year at $78,000 each and 8,000 luxury motor coaches per year at $120,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 24,000 of these campers per year at $24,000 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 3,600 units per year and reduce the sales of its motor coaches by 950 units per year.

Required: What is the amount to use as the annual sales figure when evaluating this project?

Net sales$ =

Reference no: EM13919346

Questions Cloud

Clubs will also require an increase in net working capital : McGilla Golf has decided to sell a new line of golf clubs. The clubs will sell for $740 per set and have a variable cost of $370 per set. The company has spent $160,000 for a marketing study that determined the company will sell 76,000 sets per year ..

File for formal bankruptcy instead of private restructuring : Revco Drug Store filed for bankruptcy in July of 1988 and was one of the largest bankruptcies in US financial history as well as being one of the largest leveraged buyouts. Be sure to address issues such as whether it would be better for Revco to fil..

Required rate for this stock-what is its value : Annual dividend = $1.00. Expected increase is 10% in each of the next 4 years. The stock price is expected to be $100 in the 4th year. Required rate for this stock is 14 percent. What is its value?

The bonds make semiannual payments : Heginbotham Corp. issued 20-year bonds two years ago at a coupon rate of 8.3 percent. The bonds make semiannual payments. If these bonds currently sell for 104 percent of par value, what is the YTM?

Use as the annual sales figure when evaluating this project : Winnebagel Corp. currently sells 29,000 motor homes per year at $78,000 each and 8,000 luxury motor coaches per year at $120,000 each. The company wants to introduce a new portable camper to fill out its product line; What is the amount to use as the..

Short side of a futures contract and short selling a stock : What are the similarities and differences in taking the short side of a futures contract and short selling a stock? How do the cash flows differ?

What is the market price of face value bond : Gugenheim, Inc. offers a 7.25 percent coupon bond with annual payments. The yield to maturity is 4.025 percent and the maturity date is 10 years. What is the market price of a $1,000 face value bond?

Calculate the degree of total combined leverage first : Haunted Forest, Inc. is selling fog machines. Use the following information about Haunted Forest, Inc. to answer the following questions. Average selling price per unit $329. Variable cost per unit $203 Units sold 364 Fixed costs $16,717 Interest exp..

What is the intrinsic value of a share of stock : The risk-free rate of return is 7.5%, the expected rate of return on the market portfolio is 14%, and the stock of Xyrong Corporation has a beta coefficient of 2.8. Xyrong pays out 40% of its earnings in dividends, and the latest earnings announced w..

User Account

All Pages