ACC 206 Week 5 Assessment on detailed analysis of the product portfolio expansion of ABC Company to facilitate the pricing decision of the company, the financing model to be used & the evaluation of investment opportunities

The present paper involves a detailed analysis of the product portfolio expansion of ABC Company to facilitate the pricing decision of the company, the financing model to be used by ABC through analysis of the present cash flow statements and the evaluation of investment opportunities in the form of additional equipment required to increase the profit of the company. For the same cash flow statement has been prepared using the direct method, and recommendations have been made with respect to the financing method to be used for the new product line project. Furthermore the tools of absorption and variable costing have been used in the strategic decision of product pricing. Cost Volume profit analysis has been performed to determine the break-even point and contribution margin of the new and existing product. The NPV tool of capital budgeting has been used to evaluate potential investment opportunities for ABC Company. The paper concludes with discussion on risk factors involved in the project and key recommendations to the CEO with respect to the new product line project.