PT Kolam has a project that costs $ 900,000, has a life span of five years, and has a residual value of $ 130,000. Depreciation is straight-line to zero. 14% required return and 34% tax rate. Sales are projected at 2350 units per year. The price per unit is $ 400. Variable costs per unit are $ 200 and fixed costs $ 150,000 per year. It is known that the depreciation expense is $ 180,000 per year and the engineering department estimates that you will need an initial net working capital investment of $ 50,000.

a) Sensitivity Analysis

Calculate the sensitivity of the OCF to changes in variable cost in the base-case scenario

b) Break-even Analysis

Based on the base-case scenario from the above cases, calculate the cash break-even, accounting break-even, and financial break-even for the case.

c) Operating Leverage

Calculate the degree of operating leverage in the base case scenario