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P13.7 (ROI, RI) Managers at The Tea Company are currently working on the company's 2011 budget, which holds total assets of $3,500,000. For the 2011
P13.7 (ROI, RI) Managers at The Tea Company are currently working on the company's 2011 budget, which holds total assets of $3,500,000. For the 2011 year, The Tea Company is expecting its average selling price per box of tea to be $10 and its variable costs to be $3 per box. Total fixed costs are expected to be $200,000. The company's cost of capital is 12%. a. How many boxes of tea need to be sold in 2011 to achieve a 15% ROI? b. The manager for The Tea Company receives 15% of residual income. What is the manager's anticipated bonus for 2011, assuming that the company attains the 15% ROI
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