Question
A watermelon farmer wants you to invest in his watermelon business. He sells watermelons to several roadside farmers markets every week. He promises to give
A watermelon farmer wants you to invest in his watermelon business. He sells watermelons to several roadside farmers markets every week. He promises to give you all profits for 5 years after covering operating costs and his salary and taxes each year. Your analysis of his operation revealed the following cost and price data.
| Selling price per watermelon | $6.00 |
| Variable costs (per melon) | $1.30 |
| Fixed Costs (per year) | $30,000.00 |
| Depreciation (per year) | $6,000.00 |
| Salary | $40,000.00 |
| Tax Rate | 25% |
Based on these data, how much profit will you receive if he sells 20,000 melons?
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Financial Shenanigans How To Detect Accounting Gimmicks And Fraud In Financial Reports
Authors: Howard M. Schilit, Jeremy Perler, Yoni Engelhart
4th Edition
126011726X, 9781260117264
