User Account

All Pages

Calculate the accounting break-even point

Assignment Help Accounting Basics
Reference no: EM133176430

Question - We are evaluating a project that costs $1,180,000, has a ten-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 66,000 units per year. Price per unit is $45, variable cost per unit is $25, and fixed costs are $750,000 per year. The tax rate is 35 percent, and we require a return of 15 percent on this project.

a. Calculate the accounting break-even point.

b-1. Calculate the base-case cash flow and NPV.

b-2. What Is the sensitivity of NPV to changes In the sales figure?

b-3. Calculate the change in NPV if sales were to drop by 500 units.

c. What is the sensitivity of OCF to changes in the variable cost figure?

Reference no: EM133176430

Questions Cloud

Prepare journal entries to record these transactions : The vehicle was in perfect condition, so it was put back into TAD's inventory at TAD's cost of $81,000. Prepare journal entries to record these transactions
Diversity and You : Having developed a definition of diversity in the last module, What did you take away, and how did it enhance your understanding of diversity?
What amount should be recorded initially as discount : Palayan Company issued P5,000,000 face amount, 5 year bonds at 109. What amount should be recorded initially as discount
What type of exercise programs are appropriate for adults : What type of exercise programs are appropriate for adults over 70? Should they include resistance training, aerobic training, functional training, or something
Calculate the accounting break-even point : The tax rate is 35 percent, and we require a return of 15 percent on this project. Calculate the accounting break-even point
Specify the functions of marketing : 1. Specify the functions of marketing. 2. Explain the marketing concept and its Implications for developing marketing strategles.
Prepare general journal entries for these transactions : Issued 7,000 shares of the class A preferred stock for $25 per share. Prepare general journal entries for these transactions
What is net effect of the errors on the retained earnings : December 31, 2022 prepaid insurance was overstated by P20,000. What is the net effect of the errors on the 2023 retained earnings
How much was xi jin ping inc unearned rent revenue : Xi Jin Ping, Inc. owns an office building and leases the office spaces under a one-year rental agreement. How much was Xi Jin Ping Inc unearned rent revenue

Reviews

Write a Review

Accounting Basics Questions & Answers

  The statement of cash flows if the indirect method is used

the statement of cash flows if the indirect method is used

  Organization or business for your learning team research

Identify an organization or business for your Learning Team research project. Describe the products or services it provides.

  How much will you have in savings immediately

If the deposit os made in exactly 1 month, and teh annual interest rate is 15%, how much will you have in savings immediately after you make teh 60th deposit?

  Compute the projected amount of fixed cost per month

Production in 2007 for Stowe Snow Mobile was at its highest point in the month of June, compute the projected amount of fixed cost per month

  What is the annual dividend on the preferred stock

Ayayai Corp. has 15000 shares of 6%, $100 par value, cumulative preferred stock, What is the annual dividend on the preferred stock

  Define and describe revenues and expenses

If a $4,000 debit to Equipment in a journal entry is incorrectly posted to the ledger as a $4,000 credit, and the ledger account has a resulting debit balance.

  Calculate the depreciation expense using

Assume the same information in RE112, except that Akron Incorporated purchased the asset on September 1, Year 1 instead of January 1, Year 1. Calculate the depreciation for Year 1 and Year 2 using the sum of theyears'digits method.

  Determine the expenses for the first year

The cost for the first year was $15,000 whereas the payment for the first year was $10,000. Determine the expenses for the first year

  How many years must Donald leave that balance

Donald Finley wishes to become a millionaire. How many years must Donald leave that balance in the fund in order to get his desired $1,052,000

  What are the benefits and costs of sarbanes-oxley

What are the benefits and costs of Sarbanes-Oxley? Should Sarbanes-Oxley be reformed? What provisions would you include in a revised Sarbanes-Oxley

  Which two elements of the accounting information system is

Which types of managers do NOT need an understanding of accounting and finance to do their jobs? which two elements of the accounting information system

  Prepare an income statement for the year

Prepare an income statement for the year 2014 using the multiple-step form. Common shares out-standing for 2014 total 40,550

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd