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Author Question: Wheely Bike Manufacturers expects to produce and sell 9,000 made-to-order bicycles this year. ... (Read 172 times)

Zoey63294

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on: Jul 10, 2018
Wheely Bike Manufacturers expects to produce and sell 9,000 made-to-order bicycles this year. Variable costs
  are 40 percent of sales while fixed costs total 600,000. At what price must each bicycle be sold for Wheely to
  earn EBIT of 450,000?
 
  What will be an ideal response?

Question 2

Bond prices are inversely related to market interest rates.
 
  Indicate whether the statement is true or false
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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k.lashomb

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Reply #1 on: Jul 10, 2018
Answer to Question 1

9,000P - (.40)(9,000)P - 600,000 = 450,000
9,000P - 3,600P - 600,000 = 450,000
5,400P = 1,050,000
P = 194.44

Answer to Question 2

TRUE


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