Accounting break-even level of sales

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Modern Artifacts can produce keepsakes that will be sold for $60 each. Nondepreciation fixed costs are $2,600 per year, and variable costs are $30 per unit. The initial investment of $5,000 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 10%.

a. What is the accounting break-even level of sales if the firm pays no taxes? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

b. What is the NPV break-even level of sales if the firm pays no taxes? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

c. What is the accounting break-even level of sales if the firm's tax rate is 40%? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

d. What is the NPV break-even level of sales if the firm's tax rate is 40%? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

Reference no: EM131091072

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