35. The Mr. Meadows Cookie Company can obtain accurate forecasts for 12 months based on firm orders. These forecasts and the number of workdays per month are as follows: Month Demand Forecast (in thousands of cookies) Workdays 1 850 26 10 11 12 234567820-2 1,260 24 510 20 980 18 770 22 850 23 1,050 14 1,550 21 1,350 23 1,000 24 970 21 680 13

A surfboard manufacturer lost $500,000 last year during a recession. Total revenue was $5,000,000 and total variable costs were 40% of sales. The production facility ran at 50% capacity. The production manager wants to know the following: a. What is the percent capacity required to break even? b. When the economy recovers this year, if the plant runs at 100% capacity what net income could the company realize? c. There is a possibility that sales could be so strong this year that the plant may be required to run at 120% capacity by offering a lot of overtime to its production workers. This would result in total variable costs rising by 35%. On a strictly financial basis, should the production manager plan to exceed capacity or should he advise top management to freeze production at 100% capacity? Justify your answer. Answer Solution- 9a. 58.3% 9b. $2,500,000 9c. $3,100,000

5 Imagine that a company sells portable walkie-talkie radios to construction crews. The batteries for these radios last for an average of 55 hours. The purchasing manager for this company receives a brochure in the mail that advertises a new brand of batteries. This new brand of batteries is cheaper than the brand that the company currently uses. However, the purchasing manager is concerned that the cheaper batteries may have a shorter average battery life than the current brand. (Note: The number of hours that batteries last is called their battery life.) The pricing manager installs 40 randomly selected batteries of the cheaper brand in the company's walkie-talkie radios. He finds that the mean battery life for the sample is 52 hours, with a standard deviation of 10 hours. He wants to perform a statistical test at the 1% level of significance to determine whether the cheaper batteries have a shorter average battery life span than the average life span of the brand of batteries the…

Compute the NPV statistic for Project Y if the appropriate cost of capital is 12 percent. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations and round your final answer to 2 decimal places.) Project Y Time: 1 2 3 4 Cash flow: -$8,000 $3,350 $4,180 $1,520 $300