Question: Daily Enterprises is purchasing a $13,000,000 machine. The machine will be depreciated using straight-line depreciation over its 6-year life and will have no salvage value.

Daily Enterprises is purchasing a $13,000,000 machine. The machine will be depreciated using straight-line depreciation over its 6-year life and will have no salvage value. The machine will generate revenues of $7,000,000 per year along with fixed costs of $3,000,000 per year. The marginal tax rate is 25%.

The cash flow each year is $3,541,667. The NPV of the project is $1,561,236.

Find the Net Present value Break-even level of revenues, assuming the costs are all fixed costs. Enter your answer rounded to the nearest whole number.

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