The Howard Sports Company is considering a new production line. The expected economic life of the project is 8 years. The project will generate sales and incur costs annually. Variable cost is 52% of sales. Total annual fixed costs, excluding depreciation, are $380,000. The initial outlay of the project is $1,264,000 and will be depreciated on a straight-line basis to zero at the end of the project (and the half-year rule does not apply). The company's tax rate is 30% and the discount rate is 9.10%. 

Calculate the NPV break-even level of sales. 

a. $3,843,229 

b. $2,283,398 

c. $1,473,875 

d. $1,614,946 

e. $1,332,803

Answer rating: 100% (QA)

Step 1 Step 1 Brek Even sales is when the present value o... View the full answer