Question: A project has the following estimated data: Price = $50 per unit; variable costs = $33 per unit; fixed costs = $22,000; required return =

A project has the following estimated data: Price = $50 per unit; variable costs = $33 per unit; fixed costs = $22,000; required return = 10 percent; initial investment = $21,000; life = three years. a. Ignoring the effect of taxes, what is the accounting break-even quantity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the cash break-even quantity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What is the financial break-even quantity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) d. What is the degree of operating leverage at the financial break-even level of output? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) a. Accounting break-even quantity b. Cash break-even quantity Financial break-even quantity d. DOL 1,705.88 1,294.12 1,790.85 c. 21.078
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
