Hanisch Corporation would like to use target costing for a new product it is considering introducing. At a selling price of $32 per unit, management projects sales of 30,000 units. The new product would require an investment of $300,000. The desired return on investment is 16%. The target cost per unit is closest to: (Do not round intermediate calculations.) Question 10 options:
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Hanisch Corporation would like to use target costing for a new product it is considering introducing. At a selling price of $32 per unit, management projects sales of 30,000 units. The new product would require an investment of $300,000. The desired
Question 10 options:
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$40.00
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$30.40
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$3.20
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$32.00
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- The selling price of a particular product is $37.00 per unit, fixed costs total $225,600, and the breakeven sales in dollars is $940,000, what will the variable expense per unit be? Question 4 options: $117.17 $28.12 $8.88 $45.88A proposed project has fixed costs of $7,400, depreciation expense of $1,320, and a sales quantity of 1,600 units. The total variable costs are $5,607. What is the contribution margin per unit if the projected level of sales is the accounting break-even point? Question 10 options: $6.28 $4.63 $5.45 $5.16 $8.13Question 1. A company wants to produce a new product. In order to produce this product, the fixed cost is $40,000 and the variable cost is $15 per product. a. Assume that the purchase price for the product is $55, and the estimated demand for this product is 2000 units. Then, what is your suggestion to the company? To produce or not, and if yes, how many? [provide your reasonings] b. Answer part (a) but with an estimated demand of 900 units. [provide your reasonings] c. Assume that demand depends on the purchase price so that it would be 1000 and 2000 if the purchase price is $100 and $55 respectively. Then, what purchase price do you suggest to the company? [provide your reasonings]
- Given two alternatives, A and B; you have performed the cost analysis below. Your company has an MARR of 10%, which option should you choose? A B А-B Initial Cost $125,000 $105,000 $20,000 Annual $30,500 $27,000 $3,500 Benefits Annual $2,900 $4,000 ($1,100) Costs Salvage $0 $7,000 ($7,000) Value Life 7 7 7 IRR 12.2% 12.9% 7.8% A Neither Either could be chosen, they are equally as goodGrove Audio is considering the introduction of a new model of wireless speakers with the following price and cost characteristics. Sales price $ 430 per unit Variable costs 190 per unit Fixed costs 624,000 per year Assume that the projected number of units sold for the year is 3,750. Consider requirements (b), (c), and (d) independently of each other. Required: What will the operating profit be? What is the impact on operating profit if the sales price decreases by 20 percent? Increases by 10 percent? What is the impact on operating profit if variable costs per unit decrease by 10 percent? Increase by 20 percent? Suppose that fixed costs for the year are 20 percent lower than projected, and variable costs per unit are 10 percent higher than projected. What impact will these cost changes have on operating profit for the year? Will profit go up? Down? By how much?A market research specialist told Peachtree Company that it could expect to sell 720,000 units of its new high-capacity computer disk at a price of $25. Assuming the company desires a profit margin equal to 30% of sales, what target cost per unit is necessary? Multiple Choice $17.50 $25.00 None of these $7.50
- QUESTION 9 Which one of these occurs at the financial break-even point? Fixed costs equal variable costs 0 0 0 0 0 EBIT equals zero Net income equals zero Net present value equals zero IRR equals zero QUESTION 10 A company is analyzing a proposed 3-year project using standard sensitivity analysis. The company expects to sell 15,000 units, ±5 percent. The expected variable cost per unit is $8 and the expected fixed costs are $40,000. The fixed and variable cost estimates are considered accurate within a ±7 percent range. The sales price is estimated at $15 a unit, ±6 percent. The project requires an initial investment of $120,000 for equipment that will be depreciated using the straight-line method to zero over the project's life. The equipment can be sold for $30,000 at the end of the project. The project requires $12,000 in net working capital for the three years but will be fully recovered when the project closes. The discount rate is 10 percent and tax rate is 22 percent. What is…33 Success Electronics LLC is planning to introduce a low cost smart phone with attractive features. The market research information suggests that the product should sell 2000 units at RO 30 per unit. The company seeks to make a mark-up of 20% product cost. It is estimated that the lifetime costs of the product will be as follows: Design and development costs RO 5000 Manufacturing costs RO 22 per unit End of life costs RO 7000 What is the desired profit per unit? a. RO 6 per unit b. RO 5 per unit c. RO 15 per unit d. RO 10 per unit32 Success Electronics LLC is planning to introduce a low cost smart phone with attractive features. The market research information suggests that the product should sell 2000 units at RO 30 per unit. The company seeks to make a mark-up of 20% product cost. It is estimated that the lifetime costs of the product will be as follows: Design and development costs RO 5000 Manufacturing costs RO 22 per unit End of life costs RO 7000 What is target cost per unit to achieve the desired profit? a. RO 22 per unit b. RO 20 per unit c. RO 25 per unit d. RO 24 per unit
- Consider the following production data for Alternatives A and B in a firm that uses a 10% interest rate. Alt. A Alt. B Annual fixed cost per unit $2 million $3.5 million Annual variable cost per unit 850 250 If the company is going to produce 4000 units annually, which alternative should be chosen? O a. This problem cannot be solved because there is not enough data given. Ob. Alternative A O C. Alternative B O d. Neither alternative should be chosen because the negative cash flows are greater than the positive cash flows for both alternatives.Johnston Company wants to double production of Product X from 1,000 units to 2,000 units. The variable manufacturing cost per unit is $10. The variable nonmanufacturing cost per unit is $20. There are no fixed costs. The selling price per unit is $50. What is the incremental cost of the proposed ?change $60,000 O $50,000 O $20,000 O $10,000 O $30,000 OPlentiful Products is analyzing a proposed project with expected sales of 6300 units +-5%. The expected variable cost per unit is $8 and the expected fixed costs are $22000. Cost estimates are considered accurate within a range of +-4%. The depreciation expense is $6400. The sale price is estimated at $17 per unit, +-1%. What is the sales revenue under the pessimistic case scenario? Multiple choice $107100 $125685 $94684 $106029 $100728