Hello, I need a little help figuring out the answer to this homework problem. Ca

Question

Hello,

I need a little help figuring out the answer to this homework problem. Can someone help me?

2. value: 1.00 points Problem 9-10 Financial Breakeven Niko has purchased a brand new machine to produce its High Flight line of shoes. The machine has an economic life of six years. The depreciation schedule for the machine is straight-line with no salvage value The machine costs $636,000. The sales price per pair of shoes is $61, while the variable cost is $15 $156,000 of fixed costs per year are attributed to the machine. Assume that the corporate tax rate is 35 percent and the appropriate discount rate is 9 percent. What is the financial break-even point? (Do not round intermediate calculations and round your final answer to nearest whole number (e.g., 32).) Financial break-even point units

Explanation / Answer

Financial breakeven point is 6,473 units

Financial breakeven point: (Fixed costs+Operating cash flows)/Contribution per unit                                                                                                              6,473 =(156000+636000/PV(9%,6,-1))/(61-15)

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