Question: A store will cost $800,000 to open. Variable costs will be 60 percent of sales and fixed costs are $200,000 per year. The investment will
A store will cost $800,000 to open. Variable costs will be 60 percent of sales and fixed costs are $200,000 per year. The investment will be depreciated straight-line over the 10 yearlife of the store to a salvage value of zero. The opportunity cost of capital is 8 percent and the tax rate is 30 percent. Find the net present value break- even level of sales revenues. $700,000 $840,085 $925,799 $1,125,799
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
