Kids & Toys Inc. has purchased a ($200,000) machine to produce toy cars. The machine will be

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Kids & Toys Inc. has purchased a \($200,000\) machine to produce toy cars. The machine will be fully depreciated by the straight-line method for its economic life of five years and will be worthless after its life. The firm expects that the sales price of the toy is \($25\) while its variable cost is \($5.\) The firm should also pay \($350,000\) as fixed costs each year. The corporate tax rate for the company is 25 percent, and the appropriate discount rate is 12 percent. What is the present value break-even point?

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