Solar Calculator Company proposes to invest $5 million in a new calculator manufacturing plant that will depreciate on a straight-line basis. Fixed costs are $2 million per year. A calculator costs $5 per unit to make and sells for $20 per unit. If the plant has a life of three years and the cost of capital is 12%, what is the accounting break-even level of annual sales? (Assume there are no taxes.)

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To calculate the accounting breakeven level of annual sales we need to determine the total costs and ... View the full answer