Shue Music Company is considering the sale of a new sound board used in recording studios....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Shue Music Company is considering the sale of a new sound board used in recording studios. The new board would sell for $25,300, and the company expects to sell 1,700 per year. The company currently sells 2,050 units of its existing model per year. If the new model is introduced, sales of the existing model will fall to 1,720 units per year. The old board retails for $23,700. Variable costs are 57 percent of sales, depreciation on the equipment to produce the new board will be $675,000 per year, and fixed costs are $3,400,000 per year. If the tax rate is 25 percent, what is the annual OCF for the project? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. OCF Shue Music Company is considering the sale of a new sound board used in recording studios. The new board would sell for $25,300, and the company expects to sell 1,700 per year. The company currently sells 2,050 units of its existing model per year. If the new model is introduced, sales of the existing model will fall to 1,720 units per year. The old board retails for $23,700. Variable costs are 57 percent of sales, depreciation on the equipment to produce the new board will be $675,000 per year, and fixed costs are $3,400,000 per year. If the tax rate is 25 percent, what is the annual OCF for the project? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. OCF
Expert Answer:
Posted Date:
Students also viewed these finance questions
-
Describe at least one method by which the organization can reduce change resistance?
-
A process consists of five perfectly stirred tanks in Series. The volume in each tank is 30 L, and the volumetric flow rate through the system is 5 L/min. At some particular time, the inlet...
-
As a result of the Penn Central Railroad affair, the SEC took the position that: a. Only those board directors personally involved in wrongdoing would be held liable. b. Board directors should take...
-
What is consumer behavior? Why is it important for marketers to understand consumer behavior?
-
The manager of the Carpet City outlet needs to make an accurate forecast of the demand for Soft Shag carpet (its biggest seller). If the manager does not order enough carpet from the carpet mill,...
-
A farmer wishes to have a rectangular shaped garden . The farmer has 50 feet of fencing to use to enclose the garden .Find the dimensions for the largest garden the farmer can have.
-
The focus of this assignment is on preparing journal entries for the activities related to the job costing IngA sol beadhove grumatusin beacolle olet IngA ni polovni aboog bodrinil otni 1. On the...
-
Candide Chocolate expects to sell 100,000 cases of chocolate bars during the next year. Budgeted costs per case are 150 for direct materials, 120 for direct labor, and 75 for manufacturing overhead...
-
Compute Amazon's budgeted sales for the next (seven-day) week. a. \(\$ 52.5\) million b. \(\$ 210\) million c. \(\$ 220.5\) million d. \(\$ 367.5\) million Suppose Amazon.com sells 1 million hardback...
-
The following questions relate to the auditor's consideration of the internal control structure. Select the best response. a. The primary purpose of the auditor's consideration of internal control...
-
Eagle Outfitters expects to sell 5,000 water bottles in January and 6,000 water bottles in February for \(\$ 10\) each. Prepare the sales budget for January and February.
-
Jones, CPA, who has been engaged to audit the financial statements of Ajax Inc., is about to commence obtaining an understanding of the internal control structure and is aware of the inherent...
-
1. How do you think today's low interest rate environment is impacting the time value of money? How might this change the value of an asset or liability? 2. What is the relationship between the...
-
Explain the buyers position in a typical negotiation for a business. Explain the sellers position. What tips would you offer a buyer about to begin negotiating the purchase of a business?
-
Graph \(K . m ightarrow n ightarrow q ightarrow 0 ightarrow p ightarrow m\) Use the graphs from the given figures to determine whether the sequence of vertices in the given graph is a Hamilton cycle,...
-
\((n-1)!, n=14\) Evaluate the factorial expression for the given value of \(n\).
-
Graph \(A\). \(b ightarrow d ightarrow e ightarrow f ightarrow c ightarrow b ightarrow e\) Use the graphs from the given figures to determine whether the sequence of vertices in the given graph is a...
Study smarter with the SolutionInn App