Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Need this question ASAP please Q2) The Onmacabim Corporation manufactures air conditioners for the elevators in the high-rise residential wildings. They provide the following information:

Need this question ASAP please
image text in transcribed
image text in transcribed
Q2) The Onmacabim Corporation manufactures air conditioners for the elevators in the high-rise residential wildings. They provide the following information: In the current financial year, the company has managed to sell 3,000 units, whose average selling price 5150. The associated variable cost of manufacturing an air conditioner is $100 per unit, while the fixed costs the firm average around $40,000 per annum. The annual interest expense for obtaining the firm's debt financing amounts to $20,000 per year. The applicable corporate tax rate is 40%. Show all intermediate steps, workings, calculations, and formulas, along with the final answer. A) Estimate the EBIT broak-even point in the number of whin for the eserpery. 8 mark B) Calculate the EBIT break-even point in the dollar sales wolume for the coepery: (1) matk) C) Find the minimum price per unit the firm should charge to reach the EBII breakeven. (1 eath ) D) Find the new level of the firm's Net Income, if the economy was booming and the company s Soles level bad increased by 25%. (l mark) E) Determine the firm's operating leverage and interpret its meaning. (1 mark)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Finance questions

Question

Describe the factors influencing of performance appraisal.

Answered: 1 week ago