Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

ect htpsewconnect mhecducation.com/ilow/connect htm Saved 5 Dime a Dozen Diamonds makes synthetic diamonds by treating carbon. Each diamond can be sold for $100. The materials

image text in transcribed
ect htpsewconnect mhecducation.com/ilow/connect htm Saved 5 Dime a Dozen Diamonds makes synthetic diamonds by treating carbon. Each diamond can be sold for $100. The materials cost for a standard diamond is $40. The fixed costs incurred each year for factory upkeep and administrative expenses are $220,000. The machinery costs $1.4 million and is depreciated straight-line over 10 years to a salvage ints value of zero. Hint Print Reterences a. What is the accounting break-even level of sales in terms of number of diamonds sold? (Do not round intermediate calculations.) Break-even sales diamonds per year b. What is the NPV break-even level of diamonds sold per year assuming a tax rate of 35%, a 10 year project life, and a discount rate of 10%? (Do not round intermediate calculations. Round your answer to the nearest whole number.) Breakeven sales diamonds per year Prev 50, 6 Type here to search

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Quantitative Analysis for Management

Authors: Barry Render, Ralph M. Stair, Michael E. Hanna, Trevor S. Ha

12th edition

133507335, 978-0133507331

More Books

Students also viewed these Finance questions

Question

=+How might you explain this phenomenon?

Answered: 1 week ago