# Finance Analysis Essays

1083 Words Apr 22nd, 2012 5 Pages
MARKETING MANAGEMENT
FINANCIAL ANALYSIS QUESTIONS
Members of the class will be called at random to present their answers.

1. Executives of Studio Recordings, Inc., produced the latest compact disc by the Starshine Sisters Band, titled Sunshine/Moonshine. The following cost information pertains to the new CD:
CD package and disc (direct material and labor) \$1.25/CD
Songwriters’ royalties’ \$0.35/CD
Recordings artists’ royalties’ \$1.00/CD
Selling price to CD distributor \$9.00

Calculate the following: a. Contribution per CD unit \$9.00 - \$2.60 = \$6.40 b. Break-even volume \$525,000
For Red-Away? b. How many additional sales dollars must be produced to cover each \$1.00 of incremental advertising for Rash-Away? For Red-Away? c. What absolute increase in unit sales and dollar sales will be necessary to maintain the level of total contribution dollars if the price of each product is reduced by 10 percent?

a. 150,000 / .60 = 250,000 units or \$500,000 150,000 / .75 = 200,000 units or \$200,000 b. 500,000 / 150,000 = 3.33 200,000 / 150,000 = 1.33 c. (.10x2.00=0.20) 1.80 new unit price; new unit contribution is \$.40; 600,000/.40 = 1,500,000; 1.8 x 1,500,000 = \$2,700,000; 2,700,000-2,000,000 = 700,000
(.10x1.00=0.10) 0.90 new unit price; new unit contribution is \$.65; 1,125,000/.65 = 1,730,769.23; .90 x 1,730,769.23 = \$1,557,692.31-1,500,000 = 57,692.3077

3. Video Concepts, Inc. (VCI) manufactures a line of DVRs that are distributed to large retailers. The line consists of three models. The following data are available regarding the models: Model | Selling Price per Unit | Variable Cost per Unit | Demand/Year(units) | Model LX1 | \$175 | \$100 | 2,000 | Model LX2 | 250 | 125 | 1,000 | Model LX3 | 300 | 140 | 500 |

VCI is considering the addition of a fourth model to its line. This model would be sold to retailers for \$375. The variable cost of this unit is \$225. The demand for the new Model LX4 is estimated to be 300 units per year. These unit sales of the new model are

## Related Documents

• ###### Essay Accounting and Finance: Managerial Use and Analysis

Rahul Balhara Accounting and Finance: Managerial Use and Analysis MAR12 Sec C Financial Statement Analysis Project -- A Comparative Analysis of Kohl’s Corporation and J.C. Penney Co MAR12 Sec C Analysis of Kohl’s Corporation and J.C. Penney Corporation J.C. Penney was founded by James Cash Penney in 1902. This Plano, Texas based company is presently providing family apparel and footwear, accessories, jewelries, beauty products and home furnishings via 1,100 department stores as of…

Words: 1659 - Pages: 7
• ###### Analysis Of Holder And Kenneth Meeks ' Article, Teach Your Children The Building Block Of Finance

Kenneth Meeks’ article, “Teach your Children the Building Block of Finance” presented stories about different families who are guiding their children through the path of finance. Holder and Meeks discuss the value of money and the importance of teaching to children at an early age the right attitude towards money, determining how they would use it in their lives. They also acknowledge that budgeting is an established boundary towards finance and just how children can keep track of their own spending to…

Words: 1139 - Pages: 5
• ###### Strategic Corporate Finance Analysis Essay

in key factors, the projects evaluation is adjusted for sensitivity analysis by adjusting all the worksheet variables by +10% and 10% to reflect the possible effects of having optimistic and pessimistic outcomes. (Zaharuddin, 2008) In that respect, the adjustments produces different NPV and IRR values for the two projects as indicated below. Task 2: Risk. a. Projects evaluation using sensitivity analysis Sensitivity analysis entails evaluating the effects that possible variation and changes in…

Words: 1692 - Pages: 7
• ###### Essay Corporate Finance : The Overlooked Finance Career

Corporate Finance: The Overlooked Finance Career Corporate finance has been overlooked as a secondary choice for an undergraduate finance major that wasn’t able to break into Wall Street. Until recently, the reputation of holding a corporate finance job was not as prestigious as an investment-banking resume. In this paper, my objective is to enlighten the reader on the career paths of an entry-level corporate finance analyst and why I decided that corporate finance is the right path for…

Words: 827 - Pages: 4
• ###### Acct 504 Accounting and Finance, Managerial Use and Analysis Essay

ACCT 504 Accounting and Finance, Managerial Use and Analysis Purchase here https://sellfy.com/p/TvL6/ Product Description WEEK 1Discussion Question, An Overview of Financial Statements WEEK 2 Discussion Question, Accounting Information System and Accrual Accounting Concepts WEEK 3 Case Study 1, The Complete Accounting Cycle, Parkview Landscaping Discussion 1, CVP Analysis Discussion 2, Merchandising Operations and Inventory WEEK 4 Assignment - International Business & Career…

Words: 669 - Pages: 3
• ###### An analysis of skills and knowledge required to undertake degree studies in accounting and finance and follow a future career path in financial accounting

An analysis of skills and knowledge required to undertake degree studies in accounting and finance and follow a future career path in financial accounting This essay will mark out the course of study of accounting and finance and formal assess the knowledge and skills that are needed for a future career path in financial accounting. Students that study accounting and finance often set goals to progress into accounting at a bank or at an accounting firm. So it will be advantageous for the students…

Words: 1213 - Pages: 5
• ###### Essay Finance

Corporate Finance: Theory & Practice 25557 Assignment 1) What are the appropriate costs of capital for the GPS transmitter and surveillance aircraft projects? The cost of capital is used to discount the expected cash flow of a proposed project to its present value to make an evaluation of whether to proceed or drop out the project. Normally, a company cost of capital or WACC is used as the discount rate for projects. However, as WACC represents the average rate of return demanded by investors in…

Words: 1499 - Pages: 6
• ###### An Analysis of Brazil's Economy and Finance Essay

domestic and foreign debt. In 1993, country’s Inflation reached 30 percent a month and as a result the country wouldn’t sustain growth. After many unsuccessful plans to control the inflation, finally Real Plan of Fernando Henrique Cardoso, minister of finance, worked out and brought the inflation down to a single digit. Today, Brazil with a GDP of \$2.533 trillion is the 7th largest economy in the world and it is also considered as one of the most successful emerging countries. Despite all predictions…

Words: 3017 - Pages: 13
• ###### Essay Questions On Finance And Finance

FINANCE AND ACOUNTS DEPRTMENT Each company is carried with a cause of being profitable. Cash or capital being a scare in addition to vital aid in the working of any agency desires to accept prime significance. The financial resources were deliberate and managed in a proper and non-stop manner. As most of the maximum crucial choices of a firm are the ones which relate to finance. Finance & debts from an integral a part of any organisation. proper and clean functioning of this segment could be very…

Words: 1831 - Pages: 8
• ###### Essay The Finance For A Long Term Finance

The finance available for a long period especially three years and above is known as long-term. That is, repayment of the long-term finance can be done after three years. These finances are mainly used to purchase fixed assets. The popular long-term finance sources are owner 's capital, share capital, long-term loans, debentures, government loans and grants. Since Care UK provides health and social care services, it is very easy to get government loans and grants for their expansion. Share Capital:…

Words: 1046 - Pages: