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Randall's Ales & Porters S.A., is considering expanding into Costa Rica. As an incentive, Costa Rica agrees not to charge the company any taxes. The
Randall's Ales & Porters S.A., is considering expanding into Costa Rica. As an incentive, Costa Rica agrees not to charge the company any taxes. The project has the following estimated data: price = $72 per unit variable costs = $33.84 per unit fixed costs = $7,400 required return = 13 percent initial investment = $13,000 life = five years depreciable life = five years, straight-line. Required: (a)What is the accounting break-even quantity? (Do not round your intermediate calculations.) (Click to select) (b)What is the cash break-even quantity? (Do not round your intermediate calculations.) (Click to select) (c)What is the financial break-even quantity? (Do not round your intermediate calculations.) (Click to select) (d)What is the degree of operating leverage at the financial break-even level of output (Do not round your intermediate calculations.) (Click to select)
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