A store will cost $875,000 to open. Variable costs will be 51% of sales and fixed...

A store will cost $875,000 to open. Variable costs will be 51% of sales and fixed costs are $210,000 per year. The investment costs will be depreciated straight-line over the 9 year life of the store to a salvage value of zero. The opportunity cost of capital is 8% and the tax rate is 40%. sales revenue is $700,000 per year.

Using an operating cash flow of 118,688.89, calculate the Net Present Value. = -133574.24

Find the net present value break-even level of sales revenue?

Expert Solution

jeff jeffy answered 2 years ago

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