Calculate the accounting as well as the finance break-even point for the following project: initial investment of $500,000, revenues of $700,000, $100,000 fixed costs, $75,000 depreciation, 60% variable costs, and a 35% tax rate. What happens to the break-even if a trade-off is made that increases fixed costs by $30,000 and decreases variable costs to 55% of sales? Assuming the project is going to last 6 years, and opportunity cost of capital is 9%.
Answer to relevant QuestionsJury Company wants to calculate the component costs in its capital structure. Common stock currently sells for $33, and is expected to pay a dividend of $.40. Jury's dividend growth rate is 8%, and flotation cost is $1.25. ...A stock that sold for $22 at the beginning of the year was selling for $24 at the end of the year. If the stock paid a dividend of $.50 per share, what is the simple interest rate on an investment in this stock?There has been a trend across corporate America of promoting financial officers to CEO. What are some advantages and disadvantages of thispractice?Find the present value of each future amount: $15,402 for 120 days; money earns 6.3%Find the compound amount of $25,000 is invested at 6% compounded continuously for the following number of years.
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