Aproject requires an initial fixed asset investment of $148,000, has annual fixed costs of $39,800, a contribution margin of $14.62, a tax rate of 21 percent, a discount rate of 15 percent, and straight-line depreciation over the project's 3-year life. the assets will be worthless at the end of the project. what is the financial break-even point in units per year? (hint: first solve for eac and then use the formula)

The firm needs to sale for 5,708 units to break even finnancially.

Explanation:

We convert the fixed asset investment into an annuity:

PV148,000

time3

rate0.15

C  $ 64,820.590

Now, the amount above the annual fixed cost of 39,800 will be considered a gain for tax purposes, we need to increase it by 21% o give the sales before taxes.

before taxes target contribution:

64,820.59 / 1.20 = 54,017.16

We also have a depreciation component which generates a tax shield:

(148,000 / 3) x 21% = (10,360)

Now, we solve for the break even point of the sum of this components:

39,800 + 54,017.16 - 10,360= 83,457.16‬ dollars

Each units generates 14.62 dollars we divide and obtain the sales per year in untis:

83,457.16 / 14.62 = 5.708,42

i mean they dont have to

muslims control the north africa during the period of 1500 up

to 1800. they made a barrier to prevent further european exploration from

entering the africa from the north. however, the dutch ware still able to move

toward the interior with having south africa as one of the routes leading to

the east for trading with asia.