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You were recently hired as a financial analyst for JB Trailers. They are looking at the introduction of a new product and have asked
You were recently hired as a financial analyst for JB Trailers. They are looking at the introduction of a new product and have asked you to help make the decision of whether or not to proceed. Based on your research you have determined the following information: Unit Sales Price per unit VC per unit FC per unit Base Lower Upper 1000 700 1200 Depreciation 125000 750 600 950 300 100000 250 90000 350 No NWC 120000 Assume the same information will be applicable for each year of the project. Answer each of the questions below. 1. What is the best case sales? 2 points 2. What is the worst case variable costs? 2 points 3. Assuming taxes at 34%, what is the worst case net income/loss? What is the worst case operating cas flow? 3 points
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