accounting Break Even Point - Problem 8-9 Dime a Dozen Diamo
Not what you're looking for?
Dime a Dozen Diamonds makes synthetic diamonds by treating carbon. Each diamond can be sold for $100. The materials cost for a standard diamond is $30. The fixed costs incurred each year for factory upkeep and administrative expenses are $200,000. The machinery costs $1 million a year and is depreciated straight line over 10 years to a salvage value of zero.
A. What is the accounting break-even level of sales in terms of number of diamonds sold?
B. What is the NPV break-even sales assuming a tax rate of 35%, a 10-year project life and a discount rate of 12%
See attached template 8-9
Purchase this Solution
Solution Summary
This problem shows how to calculate the accounting Break Even Point.
Solution Preview
See the attached file for complete solution. The text here may not be copied exactly as some of the symbols / tables may not print. Thanks
Problem 8-9
In part a, enter the formula to calculate the break-even point. In part b, enter ...
Purchase this Solution
Free BrainMass Quizzes
IPOs
This Quiz is compiled of questions that pertain to IPOs (Initial Public Offerings)
Understanding the Accounting Equation
These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.
Business Ethics Awareness Strategy
This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.
Accounting: Statement of Cash flows
This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.
Marketing Management Philosophies Quiz
A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.