A Project Has a Contribution Margin of $13

question 34

Multiple Choice

A project has a contribution margin of $13.27,projected fixed costs of $78,900,projected variable cost per unit of $9,and a projected financial breakeven point of 16,230 units.The depreciation expense is $36,200,and the tax rate is 35 percent.What is the operating cash flow at this level of output?

• A)$65,176.87
• B)$103,038.10
• C)$112,500.00
• D)$101,376.87
• E)$122,320.50

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Definitions:

Bills Receivable

Financial documents representing money owed to a business by its customers that is payable within a short period.

Inventories

Quantities of goods and materials that a business holds for the purpose of sale or production.

Quick Ratio

A financial metric indicating a company's ability to meet short-term liabilities with its most liquid assets, excluding inventory.

Current Ratio

A financial metric used to measure a company's ability to pay its short-term liabilities with its short-term assets.