Question: Problem 10-14 NPV Break-Even Analysis (LO3) Modern Artifacts can produce keepsakes that will be sold for $60 each. Nondepreciation fixed costs are $3,000 per year,

Problem 10-14 NPV Break-Even Analysis (LO3) Modern Artifacts can produce keepsakes that will be sold for $60 each. Nondepreciation fixed costs are $3,000 per year, and variable costs are $30 per unit. The initial investment of $3,000 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 10%. a. What is the accounting break-even level of sales if the firm pays no taxes? (Do not round intermediate calculations. Round your answer to the nearest whole number.) Acounting break-even level of sales units b. What is the NPV break-even level of sales if the firm pays no taxes? (Do not round intermediate calculations. Round your answer to the nearest whole number.) NPV break-even level of sales units c. what is the accounting break-even level of sales if the firm's tax rate is 30%? (Do not round intermediate calculations. Round your answer to the nearest whole number.) Acounting break-even level of sales units d, what is the NPV break-even level of sales if the firm's tax rate is 30%? (Do not round intermediate calculations Round your answer to the nearest whole number.) NPV break-even level of sales units
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
