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Samuelson, Inc., has just purchased a $705,000 machine to produce calculators. The machine will be fully depreciated by the straight-line method over its economic life
Samuelson, Inc., has just purchased a $705,000 machine to produce calculators. The machine will be fully depreciated by the straight-line method over its economic life of five years and will produce 52,000 calculators each year. The variable production cost per calculator is $10, and total fixed costs are $955,000 per year. The corporate tax rate for the company is 38 percent. |
For the firm to break even in terms of accounting profit, how much should the firm charge per calculator? |
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