Multiple Choice
The Financial Calculator Company proposes to invest $12 million in a new calculator-making plant that will depreciate on a straight-line basis. Fixed costs are $3 million per year. A financial calculator costs $10 per unit to manufacture and sells for $30 per unit. If the plant lasts for four years and the cost of capital is 20 percent, what is the accounting break-even level of annual sales? (Assume no taxes.)
A) 300,000 units
B) 150,000 units
C) 381,777 units
D) 750,000 units
Correct Answer:
Verified
Correct Answer:
Verified
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