Question: 8. Consider a project with the following data: EBIT break even quantity = 19,000 units; EBITDA breakeven = 13,000 units; life = 5 years; fixed

8. Consider a project with the following data: EBIT break even quantity = 19,000 units; EBITDA breakeven = 13,000 units; life = 5 years; fixed costs = $120,000; variable costs = $23 per unit; required return = 16%. Assume the initial investment is depreciated straight line to zero over the life of the project. Ignoring the effect of taxes, find the quantity needed to breakeven on a cash flow basis. (22,162 units)

Answers are provided in brackets, please show solutions as to how answer of 22,162 units was derived.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Using Break-Even Analysis [LO3] Consider a project with the following data: accounting break- even quantity = 15,500 units; cash break-even quantity = 13,200 units; life = five years; fixed costs =...

Consider a project with the following data: Accounting break even quantity = 13,700 units; cash break-even quantity = 9,600 units; life = five years; fixed costs = $185,000; variable costs = $23 per...

Consider a project with the following data: accounting break even quantity = 16,000 units; cash break even quantity = 12,500 units; life = three years; fixed costs = $120,000; variable costs = $20...

2. 10. Using break-even analysis [LO 11.3] Consider a project with the following data: accounting break-even quantity = 13 700 units; cash break-even quantity = 9,600 units; life = five years; fixed...

solve: 2. Luke Stevens General Store pays a wholesaler $30.00 for an item and then sells it with a 25 percent markup. The retailers selling price is: A. $37.50. B. $40.00. C. $48.50. D. $55.00. E....

2. Luke Stevens General Store pays a wholesaler $30.00 for an item and then sells it with a 25 percent markup. The retailers selling price is: $37.50. $40.00. $48.50. $55.00. None of the above. 3....

Problem 1: Financial Statement Ratio Analysis (40 points total) Use the following financial statements for Dell, Inc. to answer the questions which follow: BALANCE SHEET (SMil) 2017 10,298 2018 7,972...

+ 16.04.413 25. Consider a project with the following data: accounting break-even quantity = 24,240 units cash break-even quantity = 16,000 units; life = three years; fixed costs = $160,000; variable...

Consider a project with the following data: accounting break-even quantity = 11,250 units; cash break-even quantity = 10,000 units; life = seven years; fixed costs = $200,000; variable costs = $64...

Consider a project with the following data: Accounting break-even quantity = 13,800 units; Cash break-even quantity = 10,500 units; Life = 5 years; Fixed costs = $125,000; Variable costs = $32 per...

Wilkinson, Alissa. "Wolfwalkers is animated storytelling at its finest," Vox, December 11, 2020 - Forsteros, JR. "Hawkeye and a Theology of Disability," ThinkChristian, January 4, 2022. Read and...

Prepare the following: Statement of financial position Income statement Statement of changes in owners' equity Statement of cash flows Cash Accounts Receivable Less: Allowance for Uncollectible...

Read the following statement about a characteristic of preferred stocks and answer the corresponding question. Preferred dividends are usually considered a fixed charge, which makes preferred stock...

Yale Corporation issued $60,000,8% (cash interest payable semiannually on June 30 and December 31 ) 10-year bonds dated and sold on January 1 . Yale amortizes any bond discount or premium using the...