Booker Jones increased production by 20,000 barrels in 1961. If the cost of each barrel is $31.50, then these 20,000 barrels would cost $630,000. This will be added to the inventory account and hence will generate pretax profit of ($630,000 – 407,000) = $223,000. b. If the change were made retroactively as of July 1, 1959 (by adding the cost of barrels to all whiskey in inventory), what would be the effect on i.
The p-value associated with it is .157 or approximately 16% this is higher than the acceptable 5% level. Looking at the 95 % confidence interval, the upper bound is .582 which implies that .55 is in the interval, and therefore the hypothesis that p=.55 cannot be rejected in favor of the claim. c) The average (mean) number of calls made per week by salespeople that had no training is less than 145. The number of salespeople without training in the sample of 100 is only 20, so the test statistic used is the T- statistic, which resulted in the conclusion that indeed the speculation is acceptable with associated p-value of .047 which is less than the set probability of .05. With regards the 95% confidence interval, the upper bound is 144.93 which means that 145 is not in the interval that leads us to reject that the hypothesis that the mean is equal to 145 in favor of the claim that it is less
Using the criteria above, we have chosen the best method of production for each requirement in order to help us make our final decision. Income - Level Production Based on income, level production is the best choice. Level production will eliminate overtime costs of $225K and direct labor costs of $265K, reducing the percentage of COGS from 70% to 65.1% of sales. A portion of these savings would be offset by higher storage costs of $115K, which will increase operating costs each month. However, even with these additional costs, net profit under level production is projected to be $520K, which is a 48% increase over the seasonal production estimate of $351K.
Net working capital will equal 10% of the sales revenue for each year. In year one free cash flow is $2,100,000 in year two $3,600,000, a fist year increase of 53%, In year two a 23% increase, in year three to four a decrease
Customer Analysis The total industrial consumption of cyano-acrylates which the new Bond-A-Matic 2000 would dispense was 265,000 pounds in FY 1978, expected to grow to about 335,000 pounds in FY 1979. Across 16 SIC categories, approximately 174,909 firms currently used cyano-acrylates (at a 15.5% market penetration.) 11% of CA users, i.e. approximately 19,240 firms used over 10 pounds of CAs per year, comprising at-least 75% of total current market. Assuming that growth in the CA segment stagnates, and that only heavy CA applicators would be interested in dispensing equipment the total market is still estimated at 19,240 users.
$30,000 of depreciation on the equipment used to manufacture the parts. c. The supervisor's salary of $25,000, which would be avoided if the part is purchased from an outside supplier. d. $15,000 in rent from leasing the production space to another company if the part is purchased from an outside supplier. status: correct (1.0) correct: b your answer: b feedback: Correct. ________________________________________ 2 The following information pertains to the Norfolk Company's three products: Product B's production is increased to 700 units per year but B's selling price on all units of B is reduced to $8.00.
The second strategy was a relative value trade; convergence was expected but not guaranteed except perhaps over a very long horizon. LTCM sold options with a long maturity that corresponded to a strong volatility (20%), while dynamically hedging the position; LTCM would have no exposure to the corresponding equity index. In fact, the S&P 500 has had a much lower volatility in the past (13%) and was expected to come back to historical volatility, which would reduce the relative value of the options sold in the beginning, therefore LTCM would be able to make a profit. b. Explain the circumstances of the LTCM’s collapse, and why the strategies presented in part a) failed.
But the latest United Nations projection puts the figure at little more than a quarter of that - less than 11 billion. That's still 50% more than we have today, but it shows the UN expects much slower population growth in the decades to come than in decades gone by. Some might consider that an increase in the world population from seven billion to 11 billion by 2100 still represents out-of-control population growth. But this UN figure - contained in its World Population Prospects, published every two years - is considered by one expert, at least, to be much too
As stated earlier, we offered to pay $5.1 billion for the equity portion of the company. However, since it will take 12 to 18 months for the deal to close we must find the present value of our offer. When we discount our offer over 12 to 18 months, we can determine that the present value of the offer is $4.7 billion (Also see Exhibit 1). If we compare this to the implied market value of the equity, we can see that our offer is right in line with the value of the equity. As you can see, while we are paying right at the high end implied value for the firm, we are not overpaying for the company.
2. A company increased the selling price for its product from $5 to $6 per unit when total fixed expenses increased from $100,000 to $200,000 and variable expense per unit remained unchanged. How would these changes affect the break-even point? A. The break-even point in units would increase.