Ninja Toys makes toys to sell to the kids age between 3 to 9 years....
70.2K
Verified Solution
Link Copied!
Question
Accounting
Ninja Toys makes toys to sell to the kids age between 3 to 9 years. It has made a new product, the water gun. The CEO, Kimmi Ninja, is in the process of evaluating the new product using the following information:
A new water gun has two production runs a year, each with $10 000 in set-up costs.
The new water gun incurred $30 000 in development costs and is expected to be produced over the next three years.
Direct costs of producing the water gun are $40 000 per run of 5000 water gun, so total 10000 units per year.
Indirect manufacturing costs charged to each run are $45 000.
Destination charges for each water gun average $1.
Customer service expenses average $0.20 per water gun.
The water guns are selling for $25 the first year, which will increase by $3 each year thereafter.
Sales units equal production units each year.
What are the estimated life-cycle revenues?
a.$250 000
b.$840 000
c.$280 000
d.$560 000
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
