We are evaluating a project that costs $732,000, has a six year life, and has no salvage
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Question:
We are evaluating a project that costs $732,000, has a six year life, and has no salvage value. Assume that depreciation is straight line to zero over the life of the project. Sales are projected at 55,000 units per year. Price per unit is $60.00, variable cost per unit is $30.00, and fixed costs are $640,000 per year. The tax rate is 35%, and we require a return of 12 % on this project.
What is the Accounting Break even point
Base Case Cash Flow
NPV
What is the sensitivity of NPV to changes in the sales figure
What is the sensitivity to the changes in variable costs figure
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