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AudioFile would like to know its EBDAT breakeven level. The company has only one

ID: 2715836 • Letter: A

Question

AudioFile would like to know its EBDAT breakeven level. The company has only one product, the Voce9000 speaker, a high-end speaker that downloads media player files into its own memory. The firm’s speakers sell for $10,000 each. Each speaker costs $6,500 in materials and manufacturing costs (all production is outsourced to an external manufacturer). The firm’s headquarters facility lease is $350,000 annually, its marketing expense is $100,000 per year, and salary costs are $550,000 annually. Complete the following, and show all your calculations for each

Explanation / Answer

AudioFile would like to know its EBDAT breakeven level. The company has only one