Define the cash-flow break-even point as the sales volume (in dollars) at which cash flow equals zero.
Question:
a. Is the cash-flow break-even level of sales higher or lower than the zero-profit (accounting) break-even point?
b. If a project operates at cash-flow break-even [see part (a)] for its entire life, is its NPV positive or negative?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 75% (12 reviews)
a Cash flow net income depreciation If depreciation is positive then cash flow will ...View the full answer
Answered By
Muhammad Umair
I have done job as Embedded System Engineer for just four months but after it i have decided to open my own lab and to work on projects that i can launch my own product in market. I work on different softwares like Proteus, Mikroc to program Embedded Systems. My basic work is on Embedded Systems. I have skills in Autocad, Proteus, C++, C programming and i love to share these skills to other to enhance my knowledge too.
3.50+
1+ Reviews
10+ Question Solved
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-0077861629
8th edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus
Question Posted:
Students also viewed these Corporate Finance questions
-
If a project operates at cash-flow break-even for its entire life, what must be true of the project's NPV? Define the cash-flow break-even point as the sales volume (in dollars) at which cash flow...
-
For many firms, cash and inventory needs may grow less than proportionally with sales. When we recognize this fact, will the firm's internal growth rate be higher or lower than the level predicted by...
-
The following situations represent errors and frauds that could occur in financial statements. Required: State how the ratio in question would compare (higher, equal, or lower) to what the ratio...
-
Use the data in the table to complete the following. (a) Make a scatterplot of the data. Estimate a value for b so that f(x) = 0.0002x b models the data. (b) Check the accuracy of f(x). (c) The moon...
-
Patients arrive at the emergency room of Costa Valley Hospital at an average of 5 per day. The demand for emergency room treatment at Costa Valley follows a Poisson distribution. (a) Using Appendix...
-
The goal of vertical takeoff and landing (VTOL) aircraft is to achieve operation from relatively small airports and yet operate as a normal aircraft in level flight [16]. An aircraft taking off in a...
-
List applications of I.C. engines.
-
On May 1, 2010 Kirmer Corp. purchased $450,000 of 12% bonds, int. payable on January 1 & July 1 for $422,800+accrued interest. Bonds mature on Jan. 1 2016.Amortization is recorded when interest is...
-
Manufacturing overhead for the year was estimated to be $1,013,600 while the actual manufacturing overhead for the year was $955,000. Actual machine-hours for the year were 36,380 hours, and...
-
The International Lodging Merger Role of AAA Hotels Executive Committee, discuss the major negotiation point between the two hotels and how to gain a result from the AAA Hotels point of view. How to...
-
You are evaluating a project that will require an investment of $10 million that will be depreciated over a period of 7 years. You are concerned that the corporate tax rate will increase during the...
-
Modern Artifacts can produce keepsakes that will be sold for $80 each. Nondepreciation fixed costs are $1,000 per year, and variable costs are $60 per unit. The initial investment of $3,000 will be...
-
Review the following situations and record any necessary journal entries for Lumber Farm. Feb. 13 Feb. 19 Lumber Farm purchases $9,650 worth of merchandise with cash from a manufacturer. Shipping...
-
Working capital is calculated as: a. current assets minus current liabilities. b. total assets minus total liabilities. c. non-current liabilities minus current liabilities. d. either total assets...
-
At what speed must a particle move in your reference frame so that its kinetic energy is equal to its internal energy?
-
While helping an astronomy professor, you discover a binary star system in which the two stars are in circular orbits about the system's center of mass. From their color and brightness, you determine...
-
An attractive central force exerted on a particle of mass \(m\) causes the particle to travel in a bound orbit. The orbit is clliptical with semimajor axis \(a\), and the force has magnitude...
-
Which of the following statements is false? a. If an intangible asset has a finite life, it should be amortized. b. The amortization period of an intangible asset can exceed 20 years. c. Goodwill is...
-
In Problem find the consumers surplus and the producers surplus at the equilibrium price level for the given price demand and pricesupply equations. Include a graph that identifies the consumers...
-
1. Use these cost, revenue, and probability estimates along with the decision tree to identify the best decision strategy for Trendy's Pies. 2. Suppose that Trendy is concerned about her probability...
-
What was the change in net working capital during the year? 2018 2019 $4,000 $4,100 Revenue Cost of goods sold 1,600 1,700 500 Depreclatlon 520 Inventorles 300 350 Administrative expenses 500 550...
-
Construct an income statement for Fincorp for 2018 and 2019. What were reinvested earnings for 2019? 2018 2019 $4,000 $4,100 Revenue Cost of goods sold 1,600 1,700 500 Depreclatlon 520 Inventorles...
-
Suppose Home Depots Stock price falls by 10% in a given year. a. Will the firms market value added increase or decrease? b. How will this change affect your assessment of the performance of the firms...
-
Question: Read the document on this link: https://pui2022q4.tiiny.site/ 1. You form part of a company in South Africa and you have to continuously do business locally and internationally on the...
-
Banjo Education Corp. issued a 4%, $80,000 bond that pays interest semiannually each June 30 and December 31. The date of issuance was January 1, 2020. The bonds mature after four years. The market...
-
A projectile if fired from 19.6m above the ground with an initial speed of 55.6m/s at an angle of 41.2 degrees above the horizontal. a) Determine the time necessary for the projectile to reach its...
Study smarter with the SolutionInn App