Question
A company has the following estimates for a new project it's considering: Price = $100 per unit; Variable Costs = $30 per unit; Fixed Costs
A company has the following estimates for a new project it's considering: Price = $100 per unit; Variable Costs = $30 per unit; Fixed Costs = $1,600,000 per year; Quantity = 29,000 units sold per year. Assume the company believes all of its estimates are accurate only to within 11%. If you were peforming scenario analysis and calculating the project's expected annual operating cash flows under the worst-case scenario, what amount would you use for total annual cash outflow from variable costs (i.e. multiplying variable cost per unit by quantity of units sold per year under best-case scenario)?
Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit any commas and the $ sign in your response. For example, an answer of $1,000.50 should be entered as 1000.50.
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