Thaler & Co are prepared to launch their new project. They expect that, once'operational, they will sell 170,000 units at a per unit price of $13.00. Theyanticipate each unit will have a variable cost of $2.00. Thaler's project will incur$1,500,000 in annual depreciation expense and they plan to have other annualcash operating cost of $800,000. Thaler has a tax rate of 25%.What is Thaler's cash break-even quantity of units sold?O61,539 unitsO 72,728 unitsO 15,455 unitsO 136,364 unitsO 209,091 units

Contribution Margin per Unit: This represents the amount of money each unit contributes towards…

Answered: Thaler & Co are prepared to launch…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A corporation is considering purchasing a machine that will save $150,000 per year before taxes. The cost of operating the machine (including maintenance) is $30,000 per year. The machine will be needed for five years, after which it will have a zero salvage value. MACRS depreciation will be used, assuming a three-year class life. The marginal income tax rate is 25%. If the firm wants 15% return on investment after taxes, how much can it afford to pay for this machine? If the firm wants 15% return on investment after taxes, it can afford to pay ?.
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