Quiz 6 Ch 7 The Meldrum Co is analyzing a proposed project The company expects

# Quiz 6 ch 7 the meldrum co is analyzing a proposed

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Quiz 6 (Ch. 7)The Meldrum Co. is analyzing a proposed project. The company expects to sell 3,000 units, give or take 15%. The expected variable cost per unit is \$8 and the expected fixed costs are \$12,500. Cost estimates are considered accurate within a plus or minus 5% range. The depreciation expense is \$4,000. The sale price is estimated at \$18/unit, give or take 2%. What is the amount of the fixed cost per unit under the worst-case scenario? 13 Quiz 6 (Ch. 7)Assume a project has these estimated values: Sales quantity of 4,600 units, plus or minus 2%; variable cost per unit of \$17, plus or minus 3%; fixed costs of \$46,900, plus or minus 1%; depreciation of \$17,300; and a sales price of \$39/unit, plus or minus 10%. The tax rate is 34%. The company bases its sensitivity analysis on the expected case scenario. What will be the operating cash flow for a sensitivity analysis based on a sales price of \$35/unit? 14 Quiz 6 (Ch. 7)CC’s is analyzing a proposed project with anticipated sales of 3,620 units, give or take 5% at a sales price of \$24, plus or minus 2%. The variable cost per unit is \$14.60, plus or minus 4%, and the fixed costs are \$12,900, plus or minus 1%. The depreciation expense is \$8,100. If the company conducts a sensitivity analysis using a variable cost of \$16, the total variable cost estimate will be: 15 Quiz 6 (Ch. 7)A firm is reviewing a project with a labor cost of \$18.90 per unit, raw materials cost of \$21.63/unit, and fixed costs of \$8,000 a month. Sales are projected at 7,200 units total for the 3-year life of the project. What are the total variable costs per year? 16 Quiz 6 (Ch. 7)A project has earnings before interest and taxes of \$5,750, fixed costs of \$50,000, a selling price of \$13/unit, and a sales quantity of 11,500 units. Depreciation is \$7,500. What is the variable cost per unit? 17 Quiz 6 (Ch. 7)At a production level of 5,600 units, a project has total costs of \$89,000. The variable cost per unit is \$11.20. What is the amount of the total fixed costs? 18 Quiz 6 (Ch. 7)A project has a contribution margin of \$2.16 per unit. If the sales price per unit is \$11 and the fixed costs are \$24,700, what is the amount of total costs at a production level of 6,000 units? 19 Quiz 6 (Ch. 7)Wilson's Meats has fixed costs of \$.60 for every pound of meat it sells given a sales level of 32,500 pounds. It charges \$3.89 per pound of top-grade ground beef. The variable cost per pound is \$2.99. If depreciation is \$16,400, what is the accounting profit break-even point? 20   • • • 