Modern Artifacts can produce keepsakes that will be sold for $90 each. Nondepreciating fixed costs are $1,300 per year, and variable costs are $50 per unit. The initial investment of $3,900 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 12%. a. What is the degree of operating leverage of Modern Artifacts when sales are $4,950? b. What is the degree of operating leverage when sales are $9,630? c. Why is operating leverage different at these two levels of sales?
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- Modern Artifacts can produce keepsakes that will be sold for $20 each. Nondepreciation fixed costs are $200 per year, and variable costs are $30 per unit. The initial investment of $600 will be depreciated straight-line over its useful life of 6 years to a final vlaue of zero, and the discount rate is 15%. a). What is the degree of operating leverage of Modern Artifacts when sales are $640?(Don't round intermediate calculations. Round answer to 2 decimal places) b). What is the degree of operating leverage when sales are $1,620? (Don't round intermediate calculations, round final answer to 2 decimal places)Modern Artifacts can produce keepsakes that will be sold for $100 each. Nondepreciation fixed costs are $1,100 per year, and variable costs are $74 per unit. The initial investment of $4,800 will be depreciated straight-line over its useful life of five years to a final value of zero, and the discount rate is 10%. a. What is the degree of operating leverage of Modern Artifacts when sales are $8,500? Note: Round your answer to 1 decimal place. b. What is the degree of operating leverage when sales are $14,500? Note: Round your answer to 1 decimal place. a. Degree of operating leverage b. Degree of operating leverage times timesModern Artifacts can produce keepsakes that will be sold for $120 each. Nondepreciation fixed costs are $1,800 per year, and variable costs are $70 per unit. The initial investment of $5,400 will be depreciated straight-line over its useful life of 6 years to a final value of zero, and the discount rate is 18%. a. What is the degree of operating leverage of Modern Artifacts when sales are $7,440? b. What is the degree of operating leverage when sales are $12,000?
- Modern Artifacts can produce keepsakes that will be sold for $270 each. Nondepreciation fixed costs are $3,200 per year, and variable costs are $190 per unit. The initial investment of $9,600 will be depreciated straight-line over its useful life of 8 years to a final value of zero, and the discount rate is 16%. a. What is the degree of operating leverage of Modern Artifacts when sales are $16,740? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b.What is the degree of operating leverage when sales are $28,890? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. Why is operating leverage different at these two levels of sales?Modern Artifacts can produce keepsakes that will be sold for $270 each. Nondepreciation fixed costs are $3,200 per year, and variable costs are $190 per unit. The initial investment of $9,600 will be depreciated straight-line over its useful life of 8 years to a final value of zero, and the discount rate is 16%. a.What is the degree of operating leverage of Modern Artifacts when sales are $16,740? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. What is the degree of operating leverage when sales are $28,890? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. Why is operating leverage different at these two levels of sales? Degree of operating leverage is _____ when profits are _____.Modern Artifacts can produce keepsakes that will be sold for $240 each. Nondepreciation fixed costs are $3,600 per year, and variable costs are $140 per unit. The initial investment of $10,800 will be depreciated straight-line over its useful life of 3 years to a final value of zero, and the discount rate is 8%. a. What is the degree of operating leverage of Modern Artifacts when sales are $17,760? (Do not round Intermedlate calculatilons. Round your answer to 2 decimal places.) Degree of operating leverage b. What is the degree of operating leverage when sales are $35.280? (Do not round Intermedlate calculations. Round your answer to 2 decimal places.) Degree of operating leverage c. Why is operating leverage different at these two levels of sales? Degree of operating leverage is when profits are
- Modern Artifacts can produce keepsakes that will be sold for $130 each. Nondepreciation fixed costs are $2,000 per year, and variable costs are $80 per unit. The initial investment of $6,000 will be depreciated straight-line over its useful life of 3 years to a final value of zero, and the discount rate is 14%. a. What is the degree of operating leverage of Modern Artifacts when sales are $11,050? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. What is the degree of operating leverage when sales are $17,810? (Do not round intermediate calculations. Round your answer to 2 decimal places.) c. Why is operating leverage different at these two levels of sales?Modern Artifacts can produce keepsakes that will be sold for $280 each. Nondepreciation fixed costs are $5, 000 per year, and variable costs are $260 per unit. The initial investment of $13,000 will be depreciated straight-line over its useful life of five years to a final value of zero, and the discount rate is 10%. What is the accounting break-even level of sales if the firm pays no taxes? What is the NPV break-even level of sales if the firm pays no taxes? Note: Do not round intermediate calculations. Round your final answer to the nearest whole number. What is the accounting break-even level of sales if the firm's tax rate is 20%? What is the NPV break-even level of sales if the firm's tax rate is 20%? Note: Do not round intermediate calculations. Round your final answer to the nearest whole number. What is the degree of operating leverage for the firm for the NPV break-even points when the tax rate is 0% and when the tax rate is 20%? Note: Round intermediate calculation to the…Modern Artifacts can produce keepsakes that will be sold for $60 each. Nondepreciation fixed costs are $3,000 per year, and variable costs are $30 per unit. The initial investment of $3,000 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 10%. a. What is the accounting break-even level of sales if the firm pays no taxes? (Do not round intermediate calculations. Round your answer to the nearest whole number.) Accounting break-even level of sales: 120 units b. What is the NPV break-even level of sales if the firm pays no taxes? (Do not round intermediate calculations. Round your answer to the nearest whole number.) NPV break-even level of sales: 126 units c. What is the accounting break-even level of sales if the firm’s tax rate is 30%? (Do not round intermediate calculations. Round your answer to the nearest whole number.) Accounting break-even level of sales: 120 units d. What is the NPV break-even level…
- Modern Artifacts can produce keepsakes that will be sold for $60 each. Nondepreciation fixed costs are $1,400 per year, and variable costs are $30 per unit. the initial investment of $5,000 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 12%. a). What is the accounting break-even level of sales if the firm pays no taxes? b).What is the NPV break even level of sales if the firm pays no sales? c). What is the accounting break even level of sales if the firms tax rate is 20%/ d). What is the NPV break even level of sales if the firms tax rate is 20%?Your company is analyzing purchase of a machine costing $5,900 today. The investment promises to add $18,500 to sales one year from today, $14,500 two years from today, and $18,000 three years from today. Incremental cash costs should consume 75% of the incremental sales. The tax rate is 30% and the company’s financing rate is 8.2%. The investment cost is depreciated to zero over a 3-year straight-line schedule. What is the IRR for the project?What is the firm's degree of leverage?