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laiz [17]
3 years ago
11

Oxygen Optimization is considering the caffeine project, which would involve selling caffeinated oxygen for 1 year. The firm exp

ects sales of caffeinated oxygen to be 68,000 dollars and associated costs from providing caffeinated oxygen (such as tanks, filters, etc.) to be 33,000 dollars. The firm believes that sales of regular oxygen, which is currently sold by the firm, would be 37,000 dollars less with the addition of caffeinated oxygen, and that costs associated with regular oxygen to be 25,000 less with the addition of the caffeinated oxygen. Finally, Oxygen Optimization believes that the introduction of caffeinated oxygen would increase traffic to its facilities, which would increase expected sales of other products (such as masks) by 17,500 dollars more than it would be without the addition of caffeinated oxygen, and increase costs by 12,000 more than it would be without the addition of caffeinated oxygen. What is the operating cash flow (OCF) for year 1 that Oxygen Optimization should use to analyze the caffeine project? The tax rate is 30 percent and the cost of capital is 12.09 percent. Relevant depreciation is expected to be 9,000 dollars.
Business
1 answer:
Korolek [52]3 years ago
3 0

Answer:

Operating cash flow is 20498.1979 dollars

Please take a look to the excel document attached

Explanation:

EBIT=Total sales-Operating cost=43268.8019-17842.8049=25425.997.

EBIT-Deprciation=25425.997-9000=16425.997

EBT-tax=16425.997-(4927.7991)=11498.1979.

Operating cash flow=EAT+Depreciation(NON CASH EXPENSES)

=11498.1979+9000=20498.1979 dollars

Download xlsx
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The target Date fund will adjust by holding your stocks the same and slightly increasing your bonds. Therefore the correct option is (D).

<h3>What is Target-date funds ?</h3>

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6 0
2 years ago
Freight Terms Determine the amount to be paid in full settlement of each of two invoices, (a) and (b), assuming that credit for
Reika [66]

Answer and Explanation:

The computation of the amount is shown below:

a. For FOB destination

=  Merchandise price - Returns and allowances - discount

= $6,700 - $1,750 - ($6,700  - $1,750 )× 2%

= $6,700 - $1,750 - $99

= $4,851

b. For FOB shipping point

= Merchandise price - Returns and allowances - discount + Freight In

= $3,300 - $1,200 - ($3,300 - $1,200) × 1% + $200

= $3,300 - $1,200 - $21 + $200

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7 0
3 years ago
Concord Company has recently tried to improve its analysis for its manufacturing process. Units started into production equaled
Readme [11.4K]

Answer:

the material cost per unit is $4.60 per unit

Explanation:

The computation of the material cost per unit is shown below:

= Total material cost ÷ equivalent units of material

= $86,940 ÷ (18,900 - 1,000) × 100% + 1,000 × 100%

= $86,940 ÷ (17,900 + 1,000)

= $86,940 ÷ 18,900

= $4.60 per unit

Hence, the material cost per unit is $4.60 per unit

The same should be considered and relevant

5 0
2 years ago
Augustus Company is considering investing in new equipment. Based on the following, what is the Average Annual Operating Income
sladkih [1.3K]

Answer:

$50,000

Explanation:

Estimated Cost of New Equipment = $500,000

Useful life in years = 5

Estimated Residual Value = $50,000

Expected New Cash Inflows over life of asset = $700,000

Annual depreciation expense = (Estimated Cost of New Equipment-Estimated Residual Value)/Useful life in years

= ($500,000 - $50,000) / 5

= $450,000 / 5

= $90,000

Average annual cash flow = Expected New Cash Inflows over life of asset/ Useful life in years

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= $140,000

Average annual operating income = Average annual cash flow - Annual depreciation expense

= $140,000 - $90,000

= $50,000

3 0
2 years ago
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