Riggs company purchases sails and produces sailboats. it currently produces 1,200 sailboats per year, operating at normal capacity, which is about 80 % of full capacity. riggs purchases sails at $ 250 each, but the company is considering using the excess capacity to manufacture the sails instead. the manufacturing cost per sail would be $ 100 for direct materials, $ 80 for direct labor, and $ 90 for overhead. the $ 90 overhead includes $ 78,000 of annual fixed overhead that is allocated using normal capacity.

the president of riggs has come to you for advice. "it would cost me $ 270 to make the sails," she says, "but only $ 250 to buy them. should i continue buying them, or have i missed something? "

Historically, 12 percent of a mail-order firm's repeat charge-account customers have an incorrect current address in the firm's computer database. the number of customers out of 19 who have an incorrect address in the database is a binomial random variable with n = 19 and 2formula36.mml = 0.12.

Assume today is december 31, 2013. barrington industries expects that its 2014 after-tax operating income [ebit(1 – t)] will be $400 million and its 2014 depreciation expense will be $70 million. barrington's 2014 gross capital expenditures are expected to be $120 million and the change in its net operating working capital for 2014 will be $25 million. the firm's free cash flow is expected to grow at a constant rate of 4.5% annually. assume that its free cash flow occurs at the end of each year. the firm's weighted average cost of capital is 8.6%; the market value of the company's debt is $2.15 billion; and the company has 180 million shares of common stock outstanding. the firm has no preferred stock on its balance sheet and has no plans to use it for future capital budgeting projects. using the corporate valuation model, what should be the company's stock price today (december 31, 2013)? round your answer to the nearest cent. do not round intermediate calculations.

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