Question
7T)Amigo Software Inc. has total assets of $889,000, current liabilities of $192,000, and long-term liabilities of $154,000. There is $87,000 in preferred stock outstanding. Thirty thousand shares of common stock have been issued.
a.Compute book value (net worth) per share. (Round your answer to 2 decimal places.)
Book value per share$
b.If there is $56,300 in earnings available to common stockholders, and the firm’s stock has a P/E of 23 times earnings per share, what is the current price of the stock? (Do not round intermediate calculations. Round you final answer to 2 decimal places.)
Current price$
c.What is the ratio of market value per share to book value per share? (Do not round intermediate calculations. Round you final answer to 2 decimal places.)
Market value to book value times
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Question
2)Convex Mechanical Supplies produces a product with the following costs as of July 1, 2012:
Material$ 6 Labor 4 Overhead 3 $ 13
Beginning inventory at these costs on July 1 was 6,100 units. From July 1 to December 1, Convex produced 17,000 units. These units had a material cost of $10 per unit. The costs for labor and overhead were the same. Convex uses FIFO inventory accounting.
a.Assuming that Convex sold 19,000 units during the last six months of the year at $20 each, what would gross profit be?
Gross profit$
b.What is the value of ending inventory?
Ending inventory$
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Question
11)International Data Systems information on revenue and costs is only relevant up to a sales volume of 117,000 units. After 117,000 units, the market becomes saturated and the price per unit falls from $20.00 to $11.80. Also, there are cost overruns at a production volume of over 117,000 units, and variable cost per unit goes up from $10.00 to $10.50. Fixed costs remain the same at $67,000.
a.Compute operating income at 117,000 units.
Operating income $
b.Compute operating income at 217,000 units.
Operating income $
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Question
9)Eaton Tool Company has fixed costs of $340,400, sells its units for $80, and has variable costs of $43 per unit.
a.Compute the break-even point. (Round your answer to the nearest whole number.)
Break-even point units
b.Ms. Eaton comes up with a new plan to cut fixed costs to $270,000. However, more labor will now be required, which will increase variable costs per unit to $46. The sales price will remain at $80. What is the new break-even point? (Round your answer to the nearest whole number.)
New break-even point units
c.Under the new plan, what is likely to happen to profitability at very high volume levels (compared to the old plan)? Profitability will be moreProfitability will be less
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