1. PT. Lama Bela Negara produces Folding Bikes that are sold in the market at a price of Rp. 4,000,000 per unit. Each unit has variable costs of Rp. 2,700,000, and fixed costs amount to Rp. 1,750,000,000 per year. The company pays Rp. 50,000,000 in interest expenses and also pays preferred stock dividends of Rp. 50,000,000 annually. The company sells 1,500 units per year and pays a 35% tax.

Requested:

a. Calculate the BEP In Units.

b. Earnings Available for Common Stockholders.

c. DOL (Degree of Operating Leverage).

d. DFL (Degree of Financial Leverage).

e. DTL (Degree of Total Leverage).

If the number of units sold is 2,000 units, what is the Earnings Available for Common Stockholders?

2. In 2021, Grand Enterprises had revenues of 10 million dollars, cost of revenue of 7 million dollars, and purchases of 5 million dollars. Assuming a year consists of 365 days, the Average Age of Inventory (AAI) is 60 days, the Average Collection Period (ACP) is 40 days, and the Average Payment Period (APP) is 70 days.

a. Operating Cycle

b. Cash Conversion Cycle

c. Resources

d. What should the company do to manage its working capital:

3. YEAR, Unit, Sales Price / Unit

2020, 4.000, $ 10,00

2021, 5.000, $ 12,00

2022, 6.000, $ 12,00

2023, 6.500, $ 14,00

2024, 6.700, $ 14,50

Interest Expense each year $ 1,000

Fixed Cost each year $ 7,500

Variable Costs as a Percent of Sales 60%

Projected Sales Growth 10%

Tax Rate 35%

Preferred Dividend $ 1,000

Common Shares Outstanding $ 100,000

The following questions are asked:

a. Calculate Net Income.

b. Calculate EPS (Earnings Per Share).

c. Calculate the BEP in Units and $ for each year.

d. If the target EBIT in 2020 is $50,000, determine the target unit sales to achieve this EBIT target.

e. Calculate DOL, DFL, and DCL.