Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Managerial Accounting Expert

Task1. You have been appointed as a consultant for the Pristine Urban-Tech Zither, Inc. (PUTZ), manufacturers of fine zithers. The market for zithers is growing rapidly. The company purchased some land 3 years ago for $1.46 million in exceptions of using it as a toxic waste dump site however has recently appointed another company to handle all toxic materials. Based on a recent appraisal, the company thinks it could sell the land for $1.56 million on an after-tax basis. In 4 years, the land could be sold for $1.66 million after taxes. The company also appointed a marketing firm to analyze the zither market, at a cost of $131,000. An excerpt of marketing report is as follows: The zither industry will have a rapid expansion in the next four years. With the brand name recognition that PUTZ brings to bear, we feel that the company will be capable to sell 4,400, 5,300, 5,900, and 4,800 units each year for the upcoming four years, correspondingly. Again, capitalizing on the name recognition of PUTZ, we feel that a premium price of $710 can be charged for each zither. Since zithers appear to be a fad, we feel at the end of the four-year period, sales must be discontinued. PUTZ thinks that fixed costs for the project will be $455,000 per year, and variable costs are 15 percent of sales. The equipment essential for production will cost $4.10 million and will be depreciated according to a 3 year MACRS schedule. At the end of project, the equipment can be scrapped for $430,000. Net working capital of $131,000 will be needed immediately. PUTZ has a 40 percent tax rate, and the required return on the project is 13 percent. What is NPV of project?

Managerial Accounting, Accounting

  • Category:- Managerial Accounting
  • Reference No.:- M93921

Have any Question? 


Related Questions in Managerial Accounting

Individual research paper instructions1write a 8-10-page

INDIVIDUAL RESEARCH PAPER INSTRUCTIONS 1. Write a 8-10-page, double-spaced research paper that adheres to APA format. 2. It must include references from at least 6 different sources, a title page, and a reference page. 3 ...

Analysis last year pjs ice cream parlors inc reported an

Analysis Last year, PJ's Ice Cream Parlors, Inc. reported an ROE = 12.0%. The firm's debt ratio was 40%, sales were $25 million, and the capital intensity ratio was .75 times. What is the net income for PJ's last year? ( ...

Factoring resource constraints into product mix

Factoring resource constraints into product mix decisions Rose Incorporated manufactures two types of vases, small and large. The following per-unit data are available.                                                 Sma ...

Dillon jones and kline ltd is studying the acquisition of

Dillon, Jones, and Kline, Ltd. is studying the acquisition of two electrical component insertion systems for producing its sole product, the universal gismo. Data relevant to the systems follow. Model A: Variable costs, ...

Management accounting assignmentquestion 1 a how do fixed

Management Accounting Assignment Question 1: a. How do fixed costs in a business create a problem for job costing? b. Provide examples of wages that might be deemed to be (1) a direct cost and (2) an indirect costs. Ques ...

Task question 1 1000 wordsmather and peison 2006 report

Task Question 1 (1000 words) Mather and Peison (2006) report that public debt contracts tend to have a lower average number of accounting based debt covenants as well as less binding debt covenants relative to private de ...

Accounting assessment1 ohio corporation sells its product

Accounting Assessment 1. Ohio Corporation sells its product for $16 per unit and incurs variable costs of $10 per unit and total fixed costs of $12,000. What is Ohio Corporation's break-even point for sales of this produ ...

Accounting for managers- assignmentfinancial statement

Accounting for Managers- Assignment Financial Statement Analysis The following information relates to Harris Corporation. Account Current year Prior year Net sales (all credit) $520,125 $499,500 Cost of goods sold $375,9 ...

You have been asked by the president of your company to

You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $60,000. The truck falls into the MACRS 3-year class, and it will be sold after three years for ...

Assignemnt decision making with managerial accountingdue to

Assignemnt: Decision Making with Managerial Accounting Due to varying business characteristics, the managerial accounting techniques applied in each business may differ. For example, a business in the start-up phase may ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro