Compute the operating break-even point in dollars

Reference no: EM13296494

A new lumber yard is ready to open for business. It is estimated that the lumber (variable cost) will be 30% of sales, while fixed cost will be $540,000. The first year's sales estimates are $1,500,000. The cost to start up this restaurant will be $2,000,000. Two financing alternatives are being considered: a) 50% equity financing and 50% debt at 9%, or b) all equity financing. Common stock can be sold at $5 per share.

Compute the Operating Break-even point in dollars.

Reference no: EM13296494

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Compute the operating break-even point in dollars : The cost to start up this restaurant will be $2,000,000. Two financing alternatives are being considered: a) 50% equity financing and 50% debt at 9%, or b) all equity financing. Common stock can be sold at $5 per share.

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