Modern Artifacts can produce keepsakes that will be sold for $70 each. Nondepreciation fixed costs are $2,000
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Modern Artifacts can produce keepsakes that will be sold for $70 each. Nondepreciation fixed costs are $2,000 per year, and variable costs are $35 per unit. The initial investment of $4,000 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 10%.
Note: For all the requirements, do not round intermediate calculations. Round your answer up to the nearest whole unit.
- What is the accounting break-even level of sales if the firm pays no taxes?
- What is the NPV break-even level of sales if the firm pays no taxes?
- What is the accounting break-even level of sales if the firm's tax rate is 40%?
- What is the NPV break-even level of sales if the firm's tax rate is 40%?
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-0078034640
7th edition
Authors: Richard Brealey, Stewart Myers, Alan Marcus
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