Question: I need help with 7). Answer 6 is already on Chegg. 6) A factory is being set up in Haiti to supply all the sandals
I need help with 7). Answer 6 is already on Chegg.
6) A factory is being set up in Haiti to supply all the sandals sold by FLIP FLOP HOUSE. The sandals sell for $1.25 (wholesale). The pair of sandals have a material cost of $.30 ( 30 cents per pair), plus a $.20 (20 cents per pair) of over-head cost including salaries. The factory will cost $750,000 to purchase plus $600,000 in machinery, equipment, and training set up. What is the Break Even point of the factory in A) dollars and B) units?
7)7) If all 16 FLIP FLOP HOUSE stores buy 500,000 pairs each from the factory calculate the following. The factory also has a cost of capital of 8%. A) How much profit will the factory generate selling 500,000 pairs to each of the 16 stores? What would the B) IRR and C) NPV of the factory be at the sales level of 500,000 pairs per store?
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