(Do not round e.g., 32.16)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question

Transcribed Image Text:Martinez, Incorporated, has purchased a brand new machine to produce its High Flight
line of shoes. The machine has an economic life of 5 years. The depreciation schedule
for the machine is straight-line with no salvage value. The machine costs $570.000 The
sales price per pair of shoes is $83, while the variable cost is $34. Fixed costs of
$275.000 per year are attributed to the machine. The corporate tax rate is 23 percent
and the appropriate discount rate is 9 percent. What is the financial break-even point?
(Do not round intermediate calculations and round your answer to 2 decimal places.
e.g., 32.16)
Financial break-even point
units
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