Find the financial break-even quanity

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Reference no: EM1313025

Calculation of cash break-even quantity and financial break-even quantity.

In each of the following cases, find the unknown variable:

Accounting Break-Even	Unit Price	Unit Variable Cost	Fixed Costs	Depreciation
127,500	$41	$30	$820,000	?
135,000	?	43	3,200,000	$1,150,000
5,478	98	?	160,000	105,000

A project has the following estimated data: price=$68 per unit; variable costs=$41 per unit: fixed costs=$8,000; required return=15 percent; initial investment=$12,000; life=four years. Ignoring the effect of taxes, what is the accounting break-even quantity? The cash break-even quantity? The financial break-even quantity? What is the degree of operating leverage at the financial break-even level of output?

Consider a project with the following data:

accounting break-even quantity=17,000 units;

cash break-even quantity=12,000 units;

life=five years;

fixed costs=$130,000;

variable costs=$23 per unit;

required return=16 percent.

Ignoring the effect of taxes, find the financial break-even quanity

Reference no: EM1313025

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