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##### BMAL530 Assignment: Homework 5 FALL 2014

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Question;1.;award:2.45 out of;2.72 points;A jeans;maker is designing a new line of jeans called the Slims. The jeans will sell;for $330 per pair and cost $260.70 per pair in variable costs to make. (Round your answers to 2 decimal places.);2.;award:2.72 out of;2.72 points;Blanchard;Company manufactures a single product that sells for $104 per unit and whose;total variable costs are $78 per unit. The company?s annual fixed costs are;$369,200.;(1);Prepare;a contribution margin income statement for Blanchard Company at the;break-even point.;Assume the company?s fixed costs increase by $127,000. What amount of;sales (in dollars) is needed to break even?;3;2.72 out of;2.72 points;Blanchard Company manufactures a single product;that sells for $310 per unit and whose total variable costs are $248 per;unit. The company targets an annual after-tax income of $1,240,000. The;company is subject to a 20% income tax rate. Assume that fixed costs remain;at $992,000.;4;4.;award:2.72 out of;2.72 points;Blanchard;Company manufactures a single product that sells for $110 per unit and whose;total variable costs are $88 per unit. The company?s annual fixed costs are;$620,000. The sales manager predicts that annual sales of the company?s;product will soon reach 39,000 units and its price will increase to $190 per;unit. According to the production manager, the variable costs are expected to;increase to $130 per unit but fixed costs will remain $620,000. The income;tax rate is 20%. What amounts of pretax and after-tax income can the company;expect to earn from these predicted changes?;5;5.;award:2.72 out of;2.72 points;Bill;Thompson expects to invest $18,000 at 12% and, at the end of a certain;period, receive $87,968. How many years will it be before Thompson receives;the payment? (Use table B.2.) (PV of $1, FV of $1, PVA of $1;and FVA of $1) (Use appropriate factor(s) from the tables provided.);6.;award:2.72 out of;2.72 points;Ed;Summers expects to invest $20,000 for 9 years, after which he wants to;receive $33,790.00. What rate of interest must Summers earn? (Use table;B.2.) (PV of $1, FV of $1, PVA of $1;and FVA of $1) (Use appropriate factor(s) from the tables provided.);7.;award:2.72 out of;2.72 points;Sam;Weber finances a new automobile by paying $5,600 cash and agreeing to make 30;monthly payments of $400 each, the first payment to be made one month after;the purchase. The loan bears interest at an annual rate of 12%. What is the;cost of the automobile? (PV of $1, FV of $1, PVA of $1;and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your final answers to 2 decimal places.);8.;award:2.72 out of;2.72 points;Spiller;Corp. plans to issue 8%, 7-year, $460,000 par value bonds payable that pay;interest semiannually on June 30 and December 31. The bonds are dated;December 31, 2013, and are issued on that date. (PV of $1, FV of $1, PVA of $1;and FVA of $1) (Use appropriate factor(s) from the tables;provided. Round your answers to nearest whole dollar.);If the;market rate of interest for the bonds is 6% on the date of issue, what will;be the total cash proceeds from the bond issue?;9.;award:2.72 out of;2.72 points;McAdams;Company expects to earn 12% per year on an investment that will pay $599,773;six years from now. (PV of $1, FV of $1, PVA of $1;and FVA of $1) (Use appropriate factor(s) from the tables provided. Round;your answers to nearest whole dollar.);Compute;the present value of this investment.;10.;award:2.72 out of;2.72 points;On;January 1, 2013, a company agrees to pay $20,000 in ten years. If the annual;interest rate is 8%, determine how much cash the company can borrow with this;agreement. (PV of $1, FV of $1, PVA of $1;andFVA of $1) (Use appropriate factor(s) from the tables provided. Round;your answers to nearest whole dollar.);[The following information applies to;the questions displayed below.];Xcite;Equipment Co. manufactures and markets a number of rope products. Management;is considering the future of Product XT, a special rope for hang gliding;that has not been as profitable as planned. Since Product XT is manufactured;and marketed independently of the other products, its total costs can be;precisely measured. Next year?s plans call for a $300 selling price per 100;yards of XT rope. Its fixed costs for the year are expected to be $210,000;up to a maximum capacity of 550,000 yards of rope. Forecasted variable costs;are $240 per 100 yards of XT rope.;11.;award:2.64 out of;2.80 points;1.;Estimate;Product XT?s break-even point in terms of sales units. (1 unit = 100 yards.) (Do not round intermediate calculations.)

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