Question
Stellar Plastics is analyzing a proposed project. The company expects to sell 8,900 units, give or take 3 percent. The expected variable cost per unit
Stellar Plastics is analyzing a proposed project. The company expects to sell 8,900 units, give or take 3 percent. The expected variable cost per unit is $24 and the expected fixed cost is $37,000. The fixed and variable cost estimates are considered accurate within a plus or minus 5 percent range. The depreciation expense is $40,000. The tax rate is 34 percent. The sale price is estimated at $31 a unit, give or take 3 percent. What is the operating cash flow for a sensitivity analysis using total fixed costs of $40,000? Multiple Choice $22,300 $28,318 $11,682 $14,718 $6,018
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