Dan's Motor Works is analyzing a 4-year project that has estimated annual sales of 3,400 units at a sales price per unit of $54. Fixed costs are estimated at $22,000 and estimated variable costs per unit are $37.80. The initial cost of the project is $92,000. What sales quantity is required for the firm to breakeven on a financial basis if the required return is 16.80 percent? O 3,611 units O 2,800 units 3,420 units 3,039 units
Dan's Motor Works is analyzing a 4-year project that has estimated annual sales of 3,400 units at a sales price per unit of $54. Fixed costs are estimated at $22,000 and estimated variable costs per unit are $37.80. The initial cost of the project is $92,000. What sales quantity is required for the firm to breakeven on a financial basis if the required return is 16.80 percent? O 3,611 units O 2,800 units 3,420 units 3,039 units
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Dan's Motor Works is analyzing a 4-year project that has estimated annual sales of 3,400 units at a sales
price per unit of $54. Fixed costs are estimated at $22,000 and estimated variable costs per unit are $37.80.
The initial cost of the project is $92,000. What sales quantity is required for the firm to breakeven on a
financial basis if the required return is 16.80 percent?
O 3,611 units
O 2,800 units
O 3,420 units
O 3,039 units
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