Herrera music is considering the sale of a new sound board


CREATE SPREADSHEET

Herrera Music is considering the sale of a new sound board used in recording studios.  The new board would sell for $25,500 and the company expects to sell 1,400 per year.  The company currently sells 1,900 units of its existing model per year.  If the new model is introduced, sales of the existing model will fall to 1,720 units per year.  The old board retails for $21,400.  Variable costs are 55 percent of sales, depreciation on the equipment to produce the new board will be $1,350,000 per year and fixed costs are $1,250,000 per year. If the tax rate is 38 percent, what is the annual OCF for the project?

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Herrera music is considering the sale of a new sound board
Reference No:- TGS02833502

Expected delivery within 24 Hours