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Case Study There have been significant discussions on climate change recently and the Australian Federal Government is providing financial incentives to businesses that shift to
Case Study
There have been significant discussions on climate change recently and the Australian Federal Government is providing financial incentives to businesses that shift to clean energy. Your company, Battery for Life Ltd is conducting a feasibility study on whether to manufacture electric vehicle batteries EVBs The data relating to the product are provided below and you are required to use your accounting and statistics knowledge to evaluate if the company should manufacture EVBs or not.
In this case study, you are required to use accounting and statistical analyses to make a business decision on whether or not a product should be manufactured. It is highly recommended you use Microsoft Excel to complete all the required calculations.
QUESTION
Electric Vehicle Battery EVB
Use the data below to answer the questions:
The projected total sales for the EVB for the year ended June are $ and the projected total costs and operating expenses are as follows:
Table B
Item Amount $
Cost of goods sold
Sales Salaries expense
Office Salaries expense
Advertising expense
Office supplies expense
Rent expense
Insurance expense
Utility expense
Depreciation expense
Interest expense
Interest revenue
Tax expense
Round your final answers to two decimal places.
What is the gross profit amount?
What are the total operating expenses?
What is the profit before interest and tax EBIT
What is the net profit?
Calculate the Gross Profit ratio, in percentage terms, for EVB in
Calculate the Net Profit ratio, in percentage terms, for EVB in
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