Hi Fliers Is Considering Making and Selling Custom Kites in Two

question 56

Multiple Choice

Hi Fliers is considering making and selling custom kites in two sizes. The small kites would be priced at $9 and the large kites would be $24. The variable cost per unit is $5 and $11, respectively. Jill, the owner, feels that she can sell 2,600 of the small kites and 1,700 of the large kites each year. The fixed costs would only be $2,100 a year and the tax rate is 34 percent. What is the annual operating cash flow if the annual depreciation expense is $900?

• A) $20,064
• B) $20,370
• C) $20,848
• D) $21,309
• E) $21,414

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Definitions:

Coercive Power

Refers to the capability to force someone to perform a desired action by threatening with negative consequences.

Car Ratings

Evaluations or assessments provided by experts or consumers regarding the performance, safety, and overall quality of automobiles.

Type of Power

Refers to different forms of influence someone can have over others, including coercive, legitimate, expert, referent, and reward power.

Referent Power

A form of influence based on the leader's or individual's ability to attract others and build loyalty through charisma or personal traits.