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Automatic Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,240...

Automatic Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,240 per unit; variable cost = $460 per unit; fixed costs = $4.97 million; quantity = 87,000 units. Suppose the company believes all of its estimates are accurate only to within ±20 percent. What values should the company use for the four variables given here when it performs its best-case and worst-case scenario analysis? (Do not round intermediate calculations and enter your answers in dollars, not million, rounded to the nearest whole number, e.g., 1,234,567.)

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Answer #1

Scenario Unit sales Unit price Unit variable cost Fixed costs Base 87,000 $1,240 $460 $4,970,000 Best 104,400 1,488 $368 $3,9

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