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Accounting details for different projects within the Gauge Operations Corp can be found below. (12 points) Project Accounting Break-Even Point in Units Price per Unit
Accounting details for different projects within the Gauge Operations Corp can be found below. (12 points)
Project | Accounting Break-Even Point in Units | Price per Unit | Variable Cost per Unit | Fixed Costs | Depreciation |
Ruby | 6,250 | ? | $55 | $100,000 | $25,000 |
Sapphire | 750 | $1,000 | ? | $500,000 | $100,000 |
Diamond | 2,000 | $20 | $15 | $5,000 | ? |
Emerald | 2,000 | $20 | $5 | ? | $15,000 |
- Calculate the missing information for each of the above projects. (5 points)
- Ruby price per unit
- Sapphire variable cost per unit
- Diamond fixed costs
- Emerald depreciation
- Note that Projects C and D share the same accounting break-even. If sales are above the break-even point, which project do you prefer? Explain why. (2 points)
- Calculate the cash break-even for each of the above projects. What do the differences in accounting break-even and cash break-even tell you about the four projects? (5 points)
Give proper Explnation and formula used
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