Please do not give solution in image formate thanku
With the growing popularity of casual surf print clothing, two recent MBA graduates decided to broaden this casual surf concept to encompass a “surf lifestyle for the home.” With limited capital, they decided to focus on surf print table and floor lamps to accent people’s homes. They projected unit sales of these lamps to be 7,300 in the first year, with growth of 5 percent each year for the next five years. Production of these lamps will require $38,000 in net working capital to start. The net working capital will be recovered at the end of the project. Total fixed costs are $98,000 per year, variable production costs are $12 per unit, and the units are priced at $40 each. The equipment needed to begin production will cost $178,000. The equipment will be
Trending nowThis is a popular solution!
Step by stepSolved in 4 steps with 3 images
- Like a Dolphin makes swim fins for deep sea divers and recreational swimmers. Like a Dolphin has assets of $3,100,000. Its yearly fixed cost is $710,000 and variable costs amount to $26.00 for each set of fins. Between the two product lines Like a Dolphin sales volume is currently 51,800 pairs of fins. Competitors are selling similar fins at $41.50 a set. Like a Dolphin owners want to earn a 10% return on investment of the companies assets.Determine the full product cost.Like a Dolphin Revenue at market price Less: Desired Profit Target Full Product Cost With their current costs, will owners be able to achieve their target profit? Like a Dolphin Current variable costs Plus: Fixed costs Current full product costarrow_forwardWith the growing popularity of casual surf print clothing, two recent MBA graduates decided to broaden this casual surf concept to encompass a “surf lifestyle for the home.” With limited capital, they decided to focus on surf print table and floor lamps to accent people’s homes. They projected unit sales of these lamps to be 11,500 in the first year, with growth of 8 percent each year for the next five years. Production of these lamps will require $75,000 in net working capital to start. Total fixed costs are $170,000 per year, variable production costs are $21 per unit, and the units are priced at $66 each. The equipment needed to begin production will cost $650,000. The equipment will be depreciated using the straight-line method over a 5-year life and is not expected to have a salvage value. The tax rate is 25 percent and the required rate of return is 18 percent. What is the NPV of this project? (Do not round intermediate calculations and round your answer to 2 decimal places,…arrow_forwardPlease do not give solution in image format thankuarrow_forward
- Essentials Of InvestmentsFinanceISBN:9781260013924Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.Publisher:Mcgraw-hill Education,
- Foundations Of FinanceFinanceISBN:9780134897264Author:KEOWN, Arthur J., Martin, John D., PETTY, J. WilliamPublisher:Pearson,Fundamentals of Financial Management (MindTap Cou...FinanceISBN:9781337395250Author:Eugene F. Brigham, Joel F. HoustonPublisher:Cengage LearningCorporate Finance (The Mcgraw-hill/Irwin Series i...FinanceISBN:9780077861759Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan ProfessorPublisher:McGraw-Hill Education