CanDo SA Is Analyzing a Proposed Project

question 17

Multiple Choice

CanDo SA is analyzing a proposed project.The company expects to sell 12,000 units, give or take 4%.The expected variable cost per unit is €7 and the expected fixed cost is €36,000.The fixed and
Variable cost estimates are considered accurate within a plus or minus 6% range.The depreciation
Expense is €30,000.The tax rate is 34%.The sale price is estimated at €14 a unit, give or take 5%.
What is the operating cash flow for a sensitivity analysis on the expected case scenario using total
fixed costs of €32,000?

• A)€14,520
• B)€16,520
• C)€22,000
• D)€44,520
• E)€52,000

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Definitions:

Invitation

A written or verbal request to someone to go somewhere or to do something.

Submit Bids

The process of offering a specified price for goods or services, especially in the context of auctions or competitive tenders.

Reasonable Period

An amount of time which is fairly appropriate under the circumstances, often subject to interpretation based on the specific context.

Exact Period

A specific timeframe during which certain actions are to take place or conditions must be met.