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Nike can produce jerseys that will be sold for $76 each. Non-depreciated fixed costs are $1,040...

Nike can produce jerseys that will be sold for $76 each. Non-depreciated fixed costs are $1,040 per year and variable costs are $57 per unit.


a.

If the project requires an initial investment of $2,810 and is expected to last for 6 years and the firm pays no taxes, what are the accounting and NPV break-even levels of sales? The initial investment will be depreciated straight-line over 6 years to a final value of zero, and the discount rate is 9%. (Round your answers to the nearest whole dollar.)

Accounting break-even sales level :

NPV break-even sales level:
b. How do your answers change if the firm's tax rate is 40%? (Round your answers to the nearest whole dollar.)
Accounting break-even sales level:
NPV break-even sales level :
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7 a)Accounting break-even levels of sales$6,033(1040+2810/6)/(76-57) 76 8 NPV break-even levels of sales $ 6,666 11040+PMT(9%,6,-2810,0))/(76-57))76 10 b) Accounting break-even levels of sales$6,033 H((1040+2810/6)/(76-57)) 76 11 NPV break-even levels of sales $ 7,087 | (PMT(996,6,-2810,0)-(2810/6)*40%)/(1-40%)+1040)/(76-57))76

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