(Break-even point and selling price) Specialty Steel, Inc. will manufacture and sell 230,000 units next year. Fixed costs will total $320,000, and variable costs will be 50 percent of sales. a. The firm wants to achieve a level of earnings before interest and taxes of $270,000. What selling price per unit is necessary to achieve this result? b. Set up a pro forma income statement to verify your solution to part a. a. What selling price per unit is necessary to achieve a level of earnings before interest and taxes of $270,000? (Round to three decimal places.)

Rose Trading had RM210,000 of net profit in year 2021 when the selling price per unit was RM150, the variable costs per unit were RM90, and the fixed costs were RM570,000. Management expects per unit data and total fixed costs to remain the same in year 2022. The manager of Rose Trading is under pressure from investors to increase net profit by RM52,000 in year 2022.Required:(i) Compute the number of units sold in year 2021.(ii) Compute the number of units that would have to be sold in year 2022 to reach the shareholders’ desired profit level.

Acme Products, Inc. is interested in producing and selling an improved widget. Market research indicates that customers would be willing to pay $90 for such a widget and that 50,000 units could be sold each year at this price. If Acme Products requires a 75% return on sales to undertake production, what is the target cost for the new widget? Select one: O a. $31.50. O b. $67.50. OC. $58.50. Od. $22.50.

A manufacturing company is considerign the purchase of new machinery to increase its production capacity.  The company has identified a new machine that costs $500,000 and is expected to increase production by 20%.  The company expects to sell the additional products for $600,000, resulting in a net profit of $100,000.  The company can finance the purchase through a bank loan with an interest rate of 5% over a five year term.  What is the expected return on investment (ROI) for the purchase of the new machinery 5% 10% 20% 25%

Your boss has just presented you with the summary in the accompanying table of projected costs and annual receipts for a new product line. He asks you to calculate the IRR for this investment opportunity. What would you present to your boss, and how would you explain the results of your analysis? (It is widely known that the boss likes to see graphs of PW versus interest rate for this type of problem.) The company’s MARR is 10% per year.

Information:  Revenues = Estimated at $1,000,000 for the upcoming year and anticipated to grow by 5% per year with different marketing tactics will employ. Expenses = $1,000,000 for the upcoming year and anticipated to decline to 95% of revenues each year thereafter as a result of the various cost efficiencies Struggle would put in place. Questions: XYZ is contemplating either the outright purchase today or a lease of a major piece of machinery and wants you to recommend which would be preferable – lease or buy.  The following are the terms associated with each option: Purchase Price Option = $1,000,000 Incremental Borrowing Rate = 5% Estimated Life of Asset = 15 Years Lease Payments = $90,000/year for 15 Years with $1 Purchase Option at end of lease.

Dinshaw Company is considering the purchase of a new machine. The invoice price of the machine is $87,306, freight charges are estimated to be $2,620, and installation costs are expected to be $7,370. The annual cost savings are expected to be $14,980 for 11 years. The firm requires a 20% rate of return. Ignore income taxes. What is the internal rate of return on this investment? Internal rate of return % Round to 0 decimal placese

Assume that next year, management wants the company to earn a minimum profit of $ 500,000. How many units will have to sold to meet this target profit figure?

Refer to the data in question h) above. If the new plant is built, how many balls will have to be sold next year to earn the same profit (€90,000) as last year? Assume the new plant is built and that next year the company manufactures and sells 30,000 balls (the same number as sold last year). Prepare a contribution profit and loss account and compute the degree of operating leverage. Top management is confident that with a more intense sales effort and with a more creative advertising programme, the sales could be increased by 50% next year. What would be the expected percentage increase in profit? Use the degree of operating leverage to compute your answer.

A company is thinking of investing in one of two potential new products for sale. The projections are as follows: Year   Revenue/cost £ (Product A)     Revenue/cost £ (Product B)0       (150,000) outlay                        (150,000) outlay 1       24,000                                       12,0002       24,000                                       25,3333       44,000                                       52,0004       84,000                                       63,333 1.Calculate the payback period for both products in years and months, not as a decimal. Please present answer to nearest half a month.