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Firms A, B and C record the results that are presented in the following table. Calculate for each company the ROIC (%) and FCF =

Firms A, B and C record the results that are presented in the following table. Calculate for each company the ROIC (%) and FCF = NOPAT - i. Assume that the WACC is 12.5% and that the amount of capital invested in each company is $1,200 in Company A, $900 in Company B, and $700 in Company C. 


A B C
NOPAT ($) 200 200 200
Growth rate (g) 8% 12% 18%

Net investment/NOPAT


90% 80% 25%
Net investment ($) $180 $160 $50
Increase in NOPAT ($) $16 $24 $36

2). Company A sells 188 units at a price of $2.5 unit. The variable cost per Unit is $1.75 and it has total fixed costs of $63. Calculate the breakeven point in units and in value for firm A. Suppose the company wishes to make a profit of $35. Calculate the necessary level of sales in value and units required, to achieve said profit. 3). A company produces shirts and sells them on average for $40 with a 32% unit margin contribution. If total fixed costs are $300,000: What is the balance point? How many units must be sold to earn $95,000? 4. The company La Pepita Dorada produces 780,000 monthly units of an article that sells for $21.50 each, which leaves a profit after taxes (t=30%) of $2 million. If you have the necessary spare capacity and your fixed costs are $3.35 million per month, would you accept an additional order for 120,000 units offered to pay you at $18.50 each? What would be the reason?

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