Question
Automatic Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,180 per unit; variable cost = $400 per unit; fixed
Automatic Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,180 per unit; variable cost = $400 per unit; fixed costs = $4.91 million; quantity = 81,000 units. Suppose the company believes all of its estimates are accurate only to within 16 percent. |
Required: |
What values should the company use for the four variables given here when it performs its best-case and worst-case scenario analysis? (Do not round intermediate calculations. Enter your answers in dollars, not millions of dollars. Round your answers to the nearest whole dollar amount (e.g.,1,234,567).) |
Scenario | Unit Sales | Unit Price | Unit Variable Cost | Fixed Costs | |||
Base case | 81,000 | $ | 1,180 | $ | 400 | $ | 4,910,000 |
Best case | 93960 |
| 1368.8 |
|
|
|
|
Worst case | 68040 |
| 991.2 |
|
|
|
|
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