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(b) A project has the following estimated data: Price RM57 per unit Variable cost RM32 per unit Fixed costs RM9,000 Required return 12% Initial investment
(b) A project has the following estimated data: Price RM57 per unit Variable cost RM32 per unit Fixed costs RM9,000 Required return 12% Initial investment RM18,000 Life 4 years
Ignore the effect of taxes,
calculate;
(i) Accounting break-even quantity. (4 marks)
(ii) Cash break-even quantity. (3 marks)
(iii) Financial break-even quantity. (9 marks)
(iv) Degree of operating leverage at financial break-even level of output. (3 marks)
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