Fina 3383 Spring 2009

ost Projections

The bicycle will require $4,500,000 in net working capital at the start. Subsequently, total net working capital at the end of each year will be 30% of sales for that year. The variable cost per bicycle is $200, and total fixed costs are $750,000 per year.

The bicycle project will incur selling, general, and administrative (SG&A) expenses every year equivalent to 8 percent of sales. MBC is planning a very aggressive marketing campaign in all major cities.