Question: Jasper Auto Inc is going to invest in a new machine to produce Part A. The cost of the machine is $400,000. Part A will

Jasper Auto Inc is going to invest in a new machine to produce Part A. The cost of the machine is $400,000. Part A will have variable cost per unit of $75.00 and the sales price per unit will be $140.00. Fixed costs will be $80,000. The machine is expected to have a life of eight years. Jasper Auto requires a return of 10% on their investments.

Required:

Ignoring the effect of taxes, calculate the following . Round all your answers to two decimal points.

Accounting Break-even quantity (2 marks)
Cash Break-even quantity (2 marks)
Financial Break-even quantity (4 marks)
Degree of operating leverage. (2 marks

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