Molson has a new six-year project that produces high-end backpacks with an initial investment equals to $60,000. The estimated selling price equals $85 per unit and variable costs equal $60 per unit. Fixed costs equal to $26,000. Investors do require a 14% return.

What is the financial break-even quantity? Interpret your answer.

Calculate the degree of operating leverage for this project? Assuming that sales are estimated at $170,000.