Question: A five-year project has the following attributes: an initial fixed asset investment of $450,000, annual fixed costs of $85,000, variables cost of $45 per unit,

A five-year project has the following attributes: an initial fixed asset investment of $450,000, annual fixed costs of $85,000, variables cost of $45 per unit, and $75 sales price per unit. The project has a discount rate of 14.0 percent, and the tax rate is 21 percent. Straight-line depreciation applies, and the assets will be worthless at the end of the project. What is the financial break-even point in units per year?

a.1,892

b. 9,117

c. 18,987

d. 7,567 (correct)

correct answer is d. 7,567 please show the procedure.

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