Mod Inc. sells parts for $80 each. Fixed costs are $1,200 per year and variable costs...

Mod Inc. sells parts for $80 each. Fixed costs are $1,200 per year and variable costs are $65 per unit. If the initial investment is $6,600 and is expected to last for 5 years and the firm pays 35% taxes, what is the accounting and economic break-even level of sales respectively? The initial investment will be depreciated straight-line over 5 years to a final value of zero, and the discount rate is 12%.

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jeff jeffy answered 2 years ago

Mod Inc. sells parts for $125 each. Fixed costs are $1,800 per year and variable costs...

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