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zhannawk [14.2K]
2 years ago
13

The Great Fish Taco Corporation currently has fixed operating costs of $15,000​, sells its​ pre-made tacos for $6.00 per​ box, a

nd incurs variable operating costs of $2.50 per box.
If the firm has a potential investment that would simultaneously raise its fixed costs to $16,500 and allow it to charge a​ per-box sale price of $6.50 due to​ better-textured tacos, what will the impact be on its operating breakeven point in​ boxes?
Business
1 answer:
Makovka662 [10]2 years ago
3 0

Answer: The Break-Even Point will reduce from $4,285.71 to $4,125

Explanation:

To get the Break-Even Point we can divide Fixed Assets by the Contribution margin.

The Contribution Margin is the Selling Price minus the Variable Cost.

For Scenario 1 the Break-Even Point will be,

= 15,000 / ( 6 - 2.50)

= $4,285.71

For Scenario 2 the Break-Even Point is,

= 16,500 / 6.5 -2.5

= $4,125

The Break-Even Point for Scenario 2 means that even though the higher Fixed Costs could have led to a higher Break-Even Point, the higher price contributed more than the fixed costs did and led to an ultimately lower Break-Even Point than the first Scenario.

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3 years ago
Splish Company purchased a computer for $9,920 on January 1, 2019. Straight-line depreciation is used, based on a 5-year life an
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$2914

Explanation:

The following steps would be taken to determine the answer

1. Calculate depreciation expense given the initial information  

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($9,920 - $1240) / 5 =  $1736

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3 years ago
If d0 = $1.75, g (which is constant) = 3.6%, and p0 = $40.00, what is the stock's expected total return for the coming year?
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Answer:

The answer is <u>"a. 8.13%".</u>

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Given that;

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p0 = $40.00

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By putting the values;

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r - 0.036 = (1.75)(1.036) ÷ 40

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