Miller Tools Is Considering a New Project That Requires an Initial

question 38

Multiple Choice

Miller Tools is considering a new project that requires an initial investment of $81,300 for fixed assets,which will be depreciated straight-line to zero over the project's 3-year life.The project is expected to have fixed costs of $37,600 a year,and a contribution margin of $18.40.The tax rate is 34 percent and the discount rate is 15 percent.What is the financial breakeven point?

• A)2,950 units
• B)4,217 units
• C)2,200 units
• D)2,483 units
• E)3,667 units