Question
Chartreuse Co. has purchased a brand new machine to produce its High Flight line of shoes. The machine has an economic life of five years.
Chartreuse Co. has purchased a brand new machine to produce its High Flight line of shoes. The machine has an economic life of five years. The depreciation schedule for the machine is straight-line with no salvage value. The machine costs $535,000. The sales price per pair of shoes is $60, while the variable cost is $14. Fixed costs of $157,000 per year are attributed to the machine. The corporate tax rate is 23 percent and the appropriate discount rate is 8 percent. What is the financial break-even point? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
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