Jeds Cars, Inc., just purchased a $538,000 machine to produce toy cars. The machine will be fully

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Jed’s Cars, Inc., just purchased a $538,000 machine to produce toy cars. The machine will be fully depreciated by the straight-line method over its five-year economic life. Each toy sells for $34. The variable cost per toy is $9, and the firm incurs fixed costs of $365,000 each year. The corporate tax rate for the company is 22 percent. The appropriate discount rate is 10 percent. What is the financial break-even point for the project?

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Corporate Finance Core Principles And Applications

ISBN: 9781260571127

6th Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan

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