Question
Modern Artifacts can produce keepsakes that will be sold for $80 each.Non-depreciation fixed cost are $1100 per year, and variable cost are $60 per unit.The
Modern Artifacts can produce keepsakes that will be sold for $80 each.Non-depreciation fixed cost are $1100 per year, and variable cost are $60 per unit.The initial investment of $4000 will be depreciated straight line over its useful life of 5 years to a final value of zero, and the discount rate is 12%.
a. What is the account break-even level of sales if the firm pays not taxes?
b.What is the NPV break even level of sale if the firm pays not taxes?
c.What is the accounting break-even level of sales if the firm's tax rate is 40%?
d.What is the NPV break-even level if the firm's tax rate is 40%?
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