Winnebagel Corp. currently sells 21,000 motor homes per year at $59,00O each, and 7,500 luxury motor coaches per year at $96,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 16,000 of these campers per year at $9,500 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 2,500 units per year and reduce the sales of its motor coaches by 1,200 units per year. What is the amount to use as the annual sales figure when evaluating this project? (Enter your answer in dollars, not millions of dollars, e.g.,

Winnebagel Corp. currently sells 21,000 motor homes per year at $59,00O each, and 7,500 luxury motor coaches per year at $96,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 16,000 of these campers per year at $9,500 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 2,500 units per year and reduce the sales of its motor coaches by 1,200 units per year. What is the amount to use as the annual sales figure when evaluating this project? (Enter your answer in dollars, not millions of dollars, e.g.,

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Master Craft Corp. currently sells 22,000 motor homes per year at $58,000 each, and 16,000 luxury motor coaches per year at $110,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 7,000 of these campers per year at $22,000 each. An independent consultant has determined that if Master Craft introduces the new campers, it should boost the sales of its existing motor homes by 2,500 units per year and reduce the sales of its motor coaches by 1,200 units per year. This project increases the annual fixed costs by $2,000,000. Here are the costs per unit: Variable costs 50,000 99,000 17,000 Motor home $ Motor coach $ Portable camper $ The project requires buying new specialized equipment that costs $15,000,000. The company must pay $200,000 more for installation costs. The total cost could be depreciated at 20% per year (class 8). Note that the 50% rule applies. The equipment will have a resale value of $10,000,000 in three years. The…
Winnebagel Corporation currently sells 21,000 motor homes per year at $59,000 each, and 7,500 luxury motor coaches per year at $96,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 16,000 of these campers per year at $9,500 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 2,500 units per year and reduce the sales of its motor coaches by 1,200 units per year. What is the amount to use as the annual sales figure when evaluating this project? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g., 1,234,567.) Annual Slaes:
Winnebagel Corporation currently sells 20,000 motor homes per year at $103,000 each and 14,000 luxury motor coaches per year at $155,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 25,000 of these campers per year at $19,000 each. An independent consultant has determined that if the company introduces the new campers, it should boost the sales of its existing motor homes by 2,700 units per year and reduce the sales of its motor coaches by 1,300 units per year. What is the amount to use as the annual sales figure when evaluating this project? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g., 1,234,567.) Annual sales
Winnebagel Corporation currently sells 33,000 motor homes per year at $71,000 each, and 13,500 luxury motor coaches per year at $108,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 28,000 of these campers per year at $15,500 each. An independent consultant has determined that if Winnebagel introduces the new campers, it should boost the sales of its existing motor homes by 2,400 units per year and reduce the sales of its motor coaches by 1,100 units per year. What is the amount to use as the annual sales figure when evaluating this project? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g., 1,234,567.) Annual sales
Winnebagel Corp. currently sells 28,600 motor homes per year at $76,000 each and 7,600 luxury motor coaches per year at $118,000 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 23,600 of these campers per year at $22,000 each. An independent consultant has determined that if the company introduces the new campers, it could boost the sales of its existing motor homes by 3,200 units per year and reduce the sales of its motor coaches by 910 units per year. What are the annual sales for the new portable camper? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole number, e.g. 1,234,567.) What are the annual increased sales for the motor home line? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole number, e.g. 1,234,567.) What is annual loss in sales for the motor coach? (Do…
Winn Corp. currently sells 9,820 motor homes per year at $45,500 each, and 3,680 luxury motor coaches per year at $89,700 each. The company wants to introduce a new portable camper to fill out its product line. It hopes to sell 4,000 of these campers per year at $14,750 each. An independent consultant has determined that if the new campers are introduced, sales of its existing motor homes will most likely increase by 250 units per year while the sales of its motor coaches will probably decline by 368 units per year. What is the amount that should be used as the annual sales figure when evaluating the portable camper project?
Solar Shade Inc. currently sells 40,000 basic solar shade devices per year at $60,000 each, and 16,800 custom-made solar shade devices per year at $150,000 each. The company wants to introduce a new portable solar shade to fill out its product line; it hopes to sell 26,000 of these per year at $16,000 each. An independent consultant has determined that if the company introduces the new solar shades, it should boost the sales of its basic solar shades by 6,000 units per year, and reduce the sales of custom-made solar shades by 1,200 units per year. What is the amount to use as the annual sales figure when evaluating this project?
JigSaw Puzzle Company is a chain of 10 retail stores that sell puzzles. In order to more efficiently process and record sales, they are considering the purchase of a point-of-sale system. You have been asked to perform the cost-benefit analysis for this new system. The system will provide annual salary savings of $200,000 for each year of the system's 7-year life. The firm's cost of capital is 12%. The system development cost is projected to be $350,000. Annual operating costs (other than salaries) will rise by $60,000 if we implement the new system. The following factors are for 12%, and 7 years: Present value of a lump sum 0.452 Present value of an annuity 4.564 REQUIRED: Using net present value analysis, evaluate the economic feasibility of the proposed system. Your analysis in #1 above deals with only one aspect of feasibility. Briefly explain other aspects of feasibility that should be considered before a final…
Winnebagel pic currently sells 30,000 mobile caravans per year at E52,000 each and 12,000 luxury stationary caravans per year at £91,000 each. The company wants to introduce a new caravanette to fill out its product line; it hopes to sell 19,000 of these caravanettes per year at £13,000 each. An independent consultant has determined that if Winnebagel introduces the new caravanettes, it should boost the sales of its existing luxury stationary caravans by 4,500 units per year, and reduce the sales of its mobile caravans by 850 units per year. What is the amount to use as the annua sales figure when evaluating this project a) © £409,500,000 b) £44.200,000 E247.000,000 None e) £612,300,000.
Realforce is considering making a new mechanical keyboard. The company has spent $200,000 in research for a silent mechanical switch, which they can use on the new keyboard. Realforce estimates that they can sell $5,000 units of the new keyboard per year at $250 per unit for the next 4 years. The production cost per keyboard is $200. The fixed costs for the project will run $50,000 per year. To start the production, Realforce has to invest a total of $400,000 in manufacturing equipment, The equipment will be 100 percent depreciated over a straight line basis for the next 4 years and become valueless at the end of the project. The tax rate is 35 percent and the discount rate is 15 percent. a) What is the operating cash flow for this project? b) What is the project's NPV? c) Suppose that the manu facturing equipment will have a market value of $18,000 at the end of the project and the project requires an initial investment in net working capital of $10,000, which is fully recoverable at…
Phlight Restaurant is considering a delivery service. The firm expects that sales from the new service will be $150,000 per year. Phlight currently offers a sit-down service with annual sales of $100,000. While many of the delivery sales will be to new customers, Phlight estimates that 60% of their current sit-down customers will switch and use the delivery service. The level of incremental sales associated with introducing the delivery service is closest to: Select one: a. $90,000 b. $150,000 c. $60,000 d. $120,000
Leaf's Paper Company is planning to launch a new notebook product that is water resistant. The company wants to sell 30,000,000 of the new notebooks next year and wants to know what trial rate is required to achieve this goal. The market research group forecasts an awareness rate of 73% and an AČV% of 52%. Of those that try the product by purchasing 1 notebook, 24% will repurchase 5 notebooks per year. There are 180,000,000 notebook consumers in the target market. Total fixed costs to Leaf Paper Company to manufacture this new notebook are $10,000,000, with variable costs of $2.73 per notebook. What trial rate is required to achieve the company's goal?

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