*Magoo's Toy Emporium, Inc. is evaluating a project that costs $755,000, has an 8-year life, and...

 

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*Magoo's Toy Emporium, Inc. is evaluating a project that costs $755,000, has an 8-year life, and has no salvage value. The company is applying a straight-line deprecation to zero over the life of the project. Sales are projected at 65,000 units per year. Price per unit is $38, variable cost per unit is $21, and fixed costs are $665,000 per year. The marginal tax rate is 22 percent, and the required rate of return on this project is 10 percent. Calculate the Accounting Break-Even Point. *Magoo's Toy Emporium, Inc. is evaluating a project that costs $755,000, has an 8-year life, and has no salvage value. The company is applying a straight-line deprecation to zero over the life of the project. Sales are projected at 65,000 units per year. Price per unit is $38, variable cost per unit is $21, and fixed costs are $665,000 per year. The marginal tax rate is 22 percent, and the required rate of return on this project is 10 percent. Calculate the Accounting Break-Even Point.

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The accounting breakeven point is the level of sales at which the projects total revenues equal its ... View the full answer