Kylie's Cookies is considering the purchase of a larger oven that will cost $2,200 and will increase her fixed costs by $30. What would happen if she purchased the new oven to realize the variable cost savings of $0.10 per cookie, and what would happen if she raised her price by just $0.20? She feels confident that such a small price increase will decrease the sales by only 25 units and may help her offset the increase in fixed costs. Given the following current prices how would the break-even in units and dollars change if she doesn't increase the selling price and if she does increase the selling price? Complete the monthly contribution margin income statement for each of these cases. Round your answers to two decimal places. Round break-even units to a whole number. Selling Price, Variable Cost and Fixed Cost Change Analysis   With Current Price With Decreased VC and Increased FC With Increased SP, Decreased VC, and Increased FC Sales Price per Unit $1.75 $fill in the blank 1 $fill in the blank 2 Variable Cost per Unit   0.40 fill in the blank 3 fill in the blank 4 Contribution Margin per Unit $1.35 $fill in the blank 5 $fill in the blank 6 Fixed Costs $405 $fill in the blank 7 $fill in the blank 8 Break-even in Units   300 fill in the blank 9 fill in the blank 10 Break-even in Dollars $525 $fill in the blank 11 $fill in the blank 12 Monthly Contribution Margin Income Statement   With Current Price With Decreased VC and Increased FC With Increased SP, Decreased VC, and Increased FC Unit Sales, Expected      900 fill in the blank 13 fill in the blank 14 Sales $fill in the blank 15 $fill in the blank 16 $fill in the blank 17 Variable Costs fill in the blank 18 fill in the blank 19 fill in the blank 20 Contribution Margin $fill in the blank 21 $fill in the blank 22 $fill in the blank 23 Fixed Costs fill in the blank 24 fill in the blank 25 fill in the blank 26 Net Income $fill in the blank 27 $fill in the blank 28 $fill in the blank 29

Amazon is considering using high capacity drones that would make its product deliveries more efficient. For this project, $140,000 would need to be spent right away to buy the required fleet of drones. The drones will be losing their economic value in equal amount each year, fully over their 5-year economic lives. Once the drones' economic life is over, they would all be sold for $10,300 selling price to a new owner, and Amazon would then immediately purchase the same but brand-new drones for the same price as what it paid for the initial fleet of drones. When those drones' life is over, they would again be sold and, again, brand-new ones would be purchased - all for the same prices as for the initial drones, and so on, over and over. Additional information: • Amazon expects $10,100 in annual operating costs. . All future cash flows are year-end cash flows. • Amazon pays 24 percent tax rate on all taxable income. • Amazon requires an annual discount rate of 10 percent, and the rate is…

Natalie is also thinking of buying a van that will be used only for business. The cost of the van is estimated at $36,500. Natalie would spend an additional $2,500 to have the van painted. In addition, she wants the back seat of the van removed so that she will have lots of room to transport her mixer inventory as well as her baking supplies. The cost of taking out the back seat and installing shelving units is estimated at $1,500. She expects the van to last about 5 years, and she expects to drive it for 200,000 miles. The annual cost of vehicle insurance will be $2,400. Natalie estimates that at the end of the 5-year useful life the van will sell for $7,500. Assume that she will buy the van on August 15, 2022, and it will be ready for use on September 1, 2022. Natalie is concerned about the impact of the van’s cost on her income statement and balance sheet. She has come to you for advice on calculating the van’s depreciation. Instructions (c)    What impact will the three methods of…

now costs $25.25, and the price has increase exponentially, write an equation that will -32.) Barnaby's grandfather is always complaining that back when he was a teenage, he used a. If that same dinner that Barnaby's grandfather purchased for $1.50 sixty years ago to be able to buy his girlfriend dinner for only $1.50. give you the cost at different times. b. How much would you expect the same dinner to cost in 60 years?

Go Fly A Kite is considering making and selling custom kites in two sizes. The small kites would be priced at $10.50 and the large kites would be $23.50. The variable cost per unit is $5.05 and $11.10, respectively. Jill, the owner, feels that she can sell 2,600 of the small kites and 1,700 of the large kites each year. The fixed costs would be $2,100 a year and the depreciation expense is $900. The tax rate is 21 percent. What is the annual operating cash flow?

H2. A clothing manufacturer is considering whether to add hoodies to its range of products. The hoodies would sell for $45 each and the company expects to sell 10,000 units per year. Selling hoodies, however, would cause sales of conventional jumpers to decrease by 1,000 units per year. The jumpers sell for $43 per unit. The variable costs of production are $25 per unit for hoodies and $20 per unit for jumpers. If the company adds hoodies to its range of products, fixed costs will increase by $56,000 per year and annual depreciation will increase by $21,000. What is the incremental operating cash flow from selling hoodies, if the corporate tax rate is 30%?    Please show proper step by step calculation

Ruff Motors needs to select an assembly line for producing their new SUV. They have two options:• Option A is a highly automated assembly line that has a large up-front cost but low maintenancecost over the years. This option will cost $8 million today with a yearly operating cost of $2 million.The assembly line will last for 5 years and be sold for $5 million in 5 years.• Option B is a cheaper alternative with less technology, a longer life, but higher operating costs.This option will cost $7 million today with an annual operating cost of $2.5 million. This assemblyline will last for 8 years and be sold for $1 million in 8 years.The firm’s cost of capital is 12%. Assume a tax rate of zero percent.The equivalent annual cost (EAC) for Option A is $_______ million.The equivalent annual cost (EAC) for Option B is $_______ million.

Caspian Sea Drinks is considering the purchase of a plum juicer – the PJX5. There is no planned increase in production. The PJX5 will reduce costs by squeezing more juice from each plum and doing so in a more efficient manner. Mr. Bensen gave Derek the following information. What is the IRR of the PJX5? a. The PJX5 will cost $1.97 million fully installed and has a 10 year life. It will be depreciated to a book value of $173,984.00 and sold for that amount in year 10. b. The Engineering Department spent $49,587.00 researching the various juicers. c. Portions of the plant floor have been redesigned to accommodate the juicer at a cost of $15,509.00. d. The PJX5 will reduce operating costs by $430,356.00 per year. e. CSD’s marginal tax rate is 26.00%. f. CSD is 66.00% equity-financed. g. CSD’s 19.00-year, semi-annual pay, 5.73% coupon bond sells for $1,031.00. h. CSD’s stock currently has a market value of $20.05 and Mr. Bensen believes the market estimates that dividends will grow at…

A local pizza shop owner decides to hire an economic consultant to help him set his prices. Currently, one slice of pizza costs $2 and the store sells about 800 slices per week.  The pizza shop's current revenue from sales is equal to $____. The economic consultant estimates that the price elasticity of demand is equal to -0.25, and suggests that the shop owner should increase the price of a slice of pizza by $0.50; that is, the consultant recommends increasing the price of pizza by ____%. The consultant claims that doing so would (a. Increase b. Decrease or C.have no effect on)_____ the number of slices sold by ____% or ____ slices. As a result, the economist predicts that the new revenue would be ____ Thus as a result of the increase in the price there is ____ in revenue. This is due to the fact that the pizza shop owner was operating on the ____ portion of the demand curve. (fill in the blanks)

Bathrooms and kitchens are typically the most important selling features of s home. Rouse Builders could differentiate the homes by upgrading the atmos and kitchens. The upgrades would cost $22,000 per home bur would enable Rouse Builders to increase the selling prices by $38.500 per home (Kitchen and bathroom upgrades typically add about 175% of their cost to the value of any home.) If Rouse Builders makes the upgrades, what will the new co-phus price per home be? Should the company differentiate in product in this manner?