Sales Rev 10872000

No. of bikes sold ###

therefore price should be $110.05
price decided by high value 92.29
Therefore price is low

revenue recognition is not when

the bicycles are shipped to the
warehouse
This is a consignment
decrease existing sales
long term relationship

Industry is in slump
Baldwin sales are
real attraction down
is the large
volume

no addition is fixed costs as the

company is operating at 75% of
the max level.
Additional variable costs will be
there which include materials,
labor and overhead

units per month = 25000/12=2k

for 2 months
160000
working units
finished capital:
at 1000*55=55k
HV:
500*70=35k
finished units at Baldwin:
2k*2*70=280k

2k*92=185K
net extra investment in WC
=595000
net increase in WC is 715k
cash available with baldwin is
not even half of it