Chip%u2019s Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for $20 then the demand for the product will be 15000
bottles per year whereas sales will be 91 percent as high if the price is raised 10 percent. Chip%u2019s variable cost per bottle is $10 and the total fixed
cash cost for the year is $100000. Depreciation and amortization charges are $20000 and the firm has a 30 percent marginal tax rate. Management anticipates
an increased working capital need of $3000 for the year. What will be the effect of the price increase on the firm%u2019s FCF for the year? (Round
answers to nearest whole dollar e.g. 5275
At $20 per bottle the Chip%u2019s FCF is $41000 and at the new price Chip%u2019s FCF is $47660
I got the second answer right but the first one 41000 keeps coming up wrong. Can anyone see what they would get for the first one ?