James, Inc., has purchased a brand new machine to produce its High Flight line of shoes. The machine has an economic life of five years. The depreciation schedule for the machine is straight-line with no salvage value. The machine costs $530,000. The sales price per pair of shoes is $75, while the variable cost is $27. Fixed costs of $235,000 per year are attributed to the machine. The corporate tax rate is 21 percent and the appropriate discount rate is 8 percent. What is the financial break-even point? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32)

James, Inc., has purchased a brand new machine to produce its High Flight line of shoes. The machine has an economic life of five years. The depreciation schedule for the machine is straight-line with no salvage value. The machine costs $530,000. The sales price per pair of shoes is $75, while the variable cost is $27. Fixed costs of $235,000 per year are attributed to the machine. The corporate tax rate is 21 percent and the appropriate discount rate is 8 percent. What is the financial break-even point? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section: Chapter Questions

Problem 11P

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