For this assignment, you need to help Mr. Brownlow make the investment decision by using the information in the case and the data from the studies listed below. You may also need to make your own assumptions in order to carry out the break-even analysis; if you do, be sure to clearly state any of your own assumptions that you make in answering the questions. Please follow the guidelines provided below. This assignment is due on May 2 before class Please make sure you provide enough information of your analysis so that your assignment can be evaluated without further explanation. 1. Fixed Costs: (20 points) The first step is to calculate the fixed cost for the first year (1990) using the following information. Keep in mind that the start-up capital of $800,000 mentioned in the case did not include cash and receivables. You need to find out what the actual start-up capital should be. Since Mr. Brownlow did not have enough money to cover the start-up capital, he needed to borrow. You should also consider first year interest when you calculate the fixed cost. Needed start-up Capital: $800,000 + cash and receivables Study F indicates l 1.1% Cash and 14.8% receivables Assume 10% interest rate from any interest-bearing loans For this assignment, you need to help Mr. Brownlow make the investment decision by using the information in the case and the data from the studies listed below. You may also need to make your own assumptions in order to carry out the break-even analysis; if you do, be sure to clearly state any of your own assumptions that you make in answering the questions. Please follow the guidelines provided below. This assignment is due on May 2 before class Please make sure you provide enough information of your analysis so that your assignment can be evaluated without further explanation. 1. Fixed Costs: (20 points) The first step is to calculate the fixed cost for the first year (1990) using the following information. Keep in mind that the start-up capital of $800,000 mentioned in the case did not include cash and receivables. You need to find out what the actual start-up capital should be. Since Mr. Brownlow did not have enough money to cover the start-up capital, he needed to borrow. You should also consider first year interest when you calculate the fixed cost. Needed start-up Capital: $800,000 + cash and receivables Study F indicates l 1.1% Cash and 14.8% receivables Assume 10% interest rate from any interest-bearing loans