Kite Flite Is Considering Making and Selling Custom Kites in Two

question 33

Multiple Choice

Kite Flite is considering making and selling custom kites in two sizes.The small kites would be priced at $12 and the large kites would be $39.The variable cost per unit is $5 and $14, respectively.Jill, the owner, feels that she can sell 1,900 of the small kites and 1,400 of the large kites each year.The fixed costs would be only $1,890 a year and the tax rate is 34 percent.What is the annual operating cash flow if the annual depreciation expense is $380?

• A)$26,064.12
• B)$30,759.80
• C)$29,848.20
• D)$28,309.40
• E)$30,630.60

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Definitions:

Capacity

The maximum load that an organizational unit can carry or operate.

Commercial Brewery

A business that produces beer on a large scale, often incorporating various brewing techniques and marketing strategies to distribute products to a wider market.