Godo DQuestion 30The Johnny Pickles Brewing Company has been successful as a small craftmicrobrewery with a focus on distributing its products to bars and restaurants. Theyare considering a bottling line that will allow them to start distributing to grocery andparty stores. The equipment will cost $80,286 to purchase. It's expected thatadditional sales will be $26,186 per year while variable expenses are expected toincrease $4,023 annually. The equipment is expected to last 5 years and will need aone time overhaul in year 3 that will cost $8,158. It will have no salvage value at theend of its useful life. The Johnny Pickles Brewing Company uses a discount rate of12% when deciding to accept a project. What is the net present value of the project?Round your answer to the whole dollar. If the NPV is negative, enter as a negative. Ifit's positive, enter as a positive.

NPV is also known as Net Present Value. It is a capital budgeting tehcniques which help in decision…

Answered: The Johnny Pickles Brewing Company has…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 25E

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View Policies Current Attempt in Progress pport Werth Company produces tie racks. Its estimated fixed costs for the year are $288,000, and the estimated variable costs per unit are $14. Werth expects to produce and sell 60,000 racks at a price of $20 per unit. How many units will be sold at breakeven? D48,000. O 20,571. 3,600. O 14,400.
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