We are evaluating a project that costs $832,000, has an eight-year life, and has no salvage value. assume that depreciation is straight-line to zero over the life of the project. sales are projected at 40,000 units per year. price per unit is $40, variable cost per unit is $15, and fixed costs are $700,000 per year. the tax rate is 35 percent, and we require a return of 18 percent on this project. suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within ±10 percent. calculate the accounting break-even point. what is the degree of operating leverage at the accounting break-even point? calculate the base-case cash flow and npv. what is the sensitivity of npv to changes in the sales figure? what is the sensitivity of ocf to changes in the variable cost figure?

Precision dyes is analyzing two machines to determine which one it should purchase. the company requires a rate of return of 15 percent and uses straight-line depreciation to a zero book value over the life of its equipment. ignore bonus depreciation. machine a has a cost of $462,000, annual aftertax cash outflows of $46,200, and a four-year life. machine b costs $898,000, has annual aftertax cash outflows of $16,500, and has a seven-year life. whichever machine is purchased will be replaced at the end of its useful life. which machine should the company purchase and how much less is that machine's eac as compared to the other machine's

Required prepare the necessary adjusting entries in the general journal as of december 31, assuming the following: on september 1, the company entered into a prepaid equipment maintenance contract. birch company paid $3,400 to cover maintenance service for six months, beginning september 1. the payment was debited to prepaid maintenance. supplies on hand at december 31 are $3,900. unearned commission fees at december 31 are $7,000. commission fees earned but not yet billed at december 31 are $3,500. (note: debit fees receivable.) birch company's lease calls for rent of $1,600 per month payable on the first of each month, plus an annual amount equal to 1% of annual commissions earned. this additional rent is payable on january 10 of the following year. (note: be sure to use the adjusted amount of commissions earned in computing the additional rent.)

Bulldog holdings is a u. s.-based consumer electronics company. it owns smaller firms in japan and taiwan where most of its cell phone technology is developed and manufactured before being released worldwide. which of the following alternatives to integration does this best illustrate? a. venture capitalism b. franchising c. joint venture d. parent-subsidiary relationship