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(Break-even analysis) Niece Equipment Rentals of Del Valle, Texas, has recently been approached about the prospect of purchasing a large construction crane. The crane rents
(Break-even analysis) Niece Equipment Rentals of Del Valle, Texas, has recently been approached about the prospect of purchasing a large construction crane. The crane rents for $530 an hour but operator, fuel Insurance and miscellaneous expenses run S194 an hour when the crane is in use. The company owner ostimates that it will cost $950 a month to store and maintain the crane and the annual depreciation expense is $49,000. a. Calculate the accounting break-even number of annual rental hours needed to produce zero operating earnings from the crane (before taxes). b. Calculate the cash break-even point. If we ignore non-cash expenses such as depreciation in the break-even calculation, how many hours must the crane bo c. Why do we have two different break oven points? What does each one tell you? a. The accounting break-evon units of production is hours. (Round to the nearest whicle number) Enter your answer in the answer box and then click Check Answer. 2 parts remaining Clear All Check
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