The purpose of liquidity analysis is to estimate if: A. the supply of labor will be sufficient to carry out the plan B. the supply of irrigation water will be sufficient C. cash inflows will be sufficient to meet expected cash outflows D. net farm income will be positive or negative
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- Assume the demand for a companys drug Wozac during the current year is 50,000, and assume demand will grow at 5% a year. If the company builds a plant that can produce x units of Wozac per year, it will cost 16x. Each unit of Wozac is sold for 3. Each unit of Wozac produced incurs a variable production cost of 0.20. It costs 0.40 per year to operate a unit of capacity. Determine how large a Wozac plant the company should build to maximize its expected profit over the next 10 years.The Tinkan Company produces one-pound cans for the Canadian salmon industry. Each year the salmon spawn during a 24-hour period and must be canned immediately. Tinkan has the following agreement with the salmon industry. The company can deliver as many cans as it chooses. Then the salmon are caught. For each can by which Tinkan falls short of the salmon industrys needs, the company pays the industry a 2 penalty. Cans cost Tinkan 1 to produce and are sold by Tinkan for 2 per can. If any cans are left over, they are returned to Tinkan and the company reimburses the industry 2 for each extra can. These extra cans are put in storage for next year. Each year a can is held in storage, a carrying cost equal to 20% of the cans production cost is incurred. It is well known that the number of salmon harvested during a year is strongly related to the number of salmon harvested the previous year. In fact, using past data, Tinkan estimates that the harvest size in year t, Ht (measured in the number of cans required), is related to the harvest size in the previous year, Ht1, by the equation Ht = Ht1et where et is normally distributed with mean 1.02 and standard deviation 0.10. Tinkan plans to use the following production strategy. For some value of x, it produces enough cans at the beginning of year t to bring its inventory up to x+Ht, where Ht is the predicted harvest size in year t. Then it delivers these cans to the salmon industry. For example, if it uses x = 100,000, the predicted harvest size is 500,000 cans, and 80,000 cans are already in inventory, then Tinkan produces and delivers 520,000 cans. Given that the harvest size for the previous year was 550,000 cans, use simulation to help Tinkan develop a production strategy that maximizes its expected profit over the next 20 years. Assume that the company begins year 1 with an initial inventory of 300,000 cans.PROBLEM The Seminole Company wishes to apply the Miller-Orr model to manage its cash investment. Seminole’s management has determined that the cost of either investing in or selling marketable securities is $200. By looking at Seminole Company’s past cash needs, they have determined that the variance of daily cash flows is $10,000. Seminole Company’s opportunity cost of cash, per day, is estimated to be 0.05%. Seminole management has figured, based on their experience dealing with the cash flows of the company, that there should be a cushion— a safety stock—of cash of $20,000. 1. How much is the variance of daily cash flows? (Use a number, no decimal value, no commas, no currency, no space) * 2. How much is the opportunity cost of cash, per day? (Use a number, must be in decimal form. eg. 6.3%/100, encode 0.063 , no commas, no currency, no space) * 3. How much is the cost per transaction? (Use a number, no decimal value, no commas, no currency, no space) * PLEASE ANSWER ALL QUESTIONS.…
- Budgeting for a Merchandising Firm Goldberg Company is a retail sporting goods store thatuses an accrual accounting system. Facts regarding its operations follow:∙ Sales are budgeted at $250,000 for December and $225,000 for January, terms 1/eom, n/60.∙ Collections are expected to be 50% in the month of sale and 48% in the month following the sale.Two percent of sales are expected to be uncollectible and recorded in an allowance account at theend of the month of sale. Bad debts expense is included as part of operating expenses.∙ Gross margin is 30% of gross sales.∙ All accounts receivable are from credit sales. Bad debts are written off against the allowanceaccount at the end of the month following the month of sale.∙ Goldberg desires to have 80% of the merchandise for the following month’s sales on hand at the endof each month. Payment for merchandise is made in the month following the month of purchase.∙ Other monthly operating expenses to be paid in cash total $25,000.∙ Annual…Budgeting for a Merchandising Firm Goldberg Company is a retail sporting goods store thatuses an accrual accounting system. Facts regarding its operations follow:∙ Sales are budgeted at $250,000 for December and $225,000 for January, terms 1/eom, n/60.∙ Collections are expected to be 50% in the month of sale and 48% in the month following the sale.Two percent of sales are expected to be uncollectible and recorded in an allowance account at theend of the month of sale. Bad debts expense is included as part of operating expenses.∙ Gross margin is 30% of gross sales.∙ All accounts receivable are from credit sales. Bad debts are written off against the allowanceaccount at the end of the month following the month of sale.∙ Goldberg desires to have 80% of the merchandise for the following month’s sales on hand at the endof each month. Payment for merchandise is made in the month following the month of purchase.∙ Other monthly operating expenses to be paid in cash total $25,000.∙ Annual…Budgeting for a Merchandising Firm Goldberg Company is a retail sporting goods store thatuses an accrual accounting system. Facts regarding its operations follow:∙ Sales are budgeted at $250,000 for December and $225,000 for January, terms 1/eom, n/60.∙ Collections are expected to be 50% in the month of sale and 48% in the month following the sale.Two percent of sales are expected to be uncollectible and recorded in an allowance account at theend of the month of sale. Bad debts expense is included as part of operating expenses.∙ Gross margin is 30% of gross sales.∙ All accounts receivable are from credit sales. Bad debts are written off against the allowanceaccount at the end of the month following the month of sale.∙ Goldberg desires to have 80% of the merchandise for the following month’s sales on hand at the endof each month. Payment for merchandise is made in the month following the month of purchase.∙ Other monthly operating expenses to be paid in cash total $25,000.∙ Annual…
- The yearly demand for a seasonal, profitable item follows the distribution: Demand (units) Probability 1,000 20 2,000 30 3,000 40 4,000 10 A manufacturer is considering launching a project to produce this item and could produce it by one of three methods: A. (10%). Use existing tools at a cost of S6 per unit. B. (10%). Buy cheap, special equipment for $1,000. The value of the equipment at the end of the year (salvage value) is zero. The cost would be reduced to $3 per unit. C. (10%). Buy high-quality, special equipment for $10,000 that can be depreciated over four years (one fourth of the cost each year). The cost with this equipment would be only S2 per unit. Set up this project as a decision tree to find whether the manufacturer should approve this project, and if so, which method of production to use to maximize profit. Hint: Compare total annual costs. Assume that production must meet all demand; each unit demanded and sold means more profit.A company sells its products to wholesalers in batches of 1,000 units only. The daily demand for its product and the respective probabilities are given below. Demand (Units) Probability 0 0.1 1000 0.3 2000 0.4 3000 0.1 4000 0.1 a. Determine the expected daily demand. b. Assume that the company sells its product at $3.90 per unit. What is the expected daily revenue?A relatively small privately owned coal-mining company has the sales results summarized below. Determine the annual percentage depletion for the coal mine. Assume the company's taxable income is $125,000 each year. Sales, Tons 34,300 Year Spot Sales Price, $/Ton 1 9.82 2. 50,100 11.5 71,900 11.23 50% of the Gross Depletion Allowed Year taxable Income, $ amount Depletion amount 1. 3.
- A firm produces three products , A , B and C , for sale both in the domestic market and in the export market and for sale to other firms . Last year domestic sales were , respectively ,50 , 60 and 80 . Exportssales were 25 , 40 and 20 . Sales to other firms were 10 , 20 and 30 . All figures are in units of thousands .This year domestic sales are expected to increase by 5% and exports sales by 10% . Sales to other firmsare expected to remain the same . The firm offers the products at the same price in all three markets Prices are currently $ 3 , $ 4 and $ 5 . Production costs for the three products are $ 2 , $ 3 and $ 4 . Find the projected profit of product A , product B and product C for this year , respectively treat the questions as products ,not fucus on product names A . ( 190 , 85 , 60) B . ( 199.5 , 93.5 , 60 ) C . ( 27.5 , 44 , 55 ) D . ( 52.5 , 63 , 84 )Assume an MARR of 4.0%. Note: All values shown are in 1000’s, thus -80 represents -80,000. Compute the IRR, ERR and DBPB for the investment outlined in the following cash flow table: 3. Year 1 4 6. 8. 9. Revenue +1350 +1300 +1250 +1200 +1350 +1300 +1250 +1200 +1150 O&M Costs -80 -80 -80 -80 -80 -80 -80 -80 -80 Capital Costs or -8000 -400 +25 Other Major CostsThe local high school soccer club need to borrow to finance a new soccer field. Repayment of the loan involves payments of $10 000.00 at the end of every 3 months for 8 years. No payments are to be made during the development period of 5 years. If interest is 8% compounded quarterly, how much did the Achievers borrow? a) $162 064.83 b) $234 683.35 c) $157 935.17 d) $175.935.71 e) $320 000.00 .