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But we believe that such claims will be so marginal low that they are not necessary to consider.
6. Given you answer to Question 4 and 5, what is the total cost of warranty claims that Rapid Fire will experience in 1999, 2000, 2001?
Year Products sold Failuring products Warranty Claims Estimated Cost
1994 40000 $28,56
1995
1996
1997
1998
1999 12000 7200 $240 698
2000 16000 8000 $275 466
2001 12000 3600 $127 678
Total 40 000 18 800 $643 842
7...
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How can Rapid Fire incorporate the projected cost of future warranty claims from 1994 sales of its Supreme battery within the pricing framework of this product?
Important information
Rapid Fire after cost of capital: 14%
Added promotional expenses from the Supreme battery; $150,000
If Rapid Fire only incorporate one decade of warranty claim, and that the battery is produced at the same time it is made, they do this by discounting future cash flows back to 1994...
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