Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

that depreciation is straight-i year. Price is 24 percent, and costs $874,800, has a nine-year life, and has no salvage value. Assume ne to zero

image text in transcribed
that depreciation is straight-i year. Price is 24 percent, and costs $874,800, has a nine-year life, and has no salvage value. Assume ne to zero over the life of the project. Sales are projected at 85,000 units per variable cost per unit is $39, and fixed costs are $765,000 per year. The tax rate per unit is $55, we require a return of 11 percent on this project. accounting break-even point. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) intermediate calculations and round your answer to 3 decima cash flow answer to the nearest whole number, e.g., 32. Round your NPV answer to 2 decimal a-2. What is the degree of operating leverage at the accounting break-even point? (Do not round l places, e.g., 32.161.) ate the base-case cash flow and NPV. (Do not round intermediate calculations. Round your b-2. What is the sensitivity of NPV to changes in the quantity sold? (Do not round intermediate c. What is the sensitivity of OCF to changes in the variable cost figure? (A negative answer should be places, e.g., 32.16.) calculations and round your answer to 2 decimal places, e.g., 32.16.) indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) units a-1. Break-even point a-2. DOL b-1. Cash flow NPV

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals of Financial Management

Authors: Eugene F. Brigham, Joel F. Houston

Concise 6th Edition

324664559, 978-0324664553

More Books

Students also viewed these Finance questions

Question

=+b. What groups in society would benefit from this change?

Answered: 1 week ago