The Accounting Break-Even Production Quantity for a Project Is 12,320

question 66

Multiple Choice

The accounting break-even production quantity for a project is 12,320 units.The fixed costs are $216,000 and the contribution margin per unit is $28.The fixed assets required for the project will be depreciated on straight-line basis to zero over the project's 5-year life.What is the amount of fixed assets required for this project?

• A)$325,920
• B)$644,800
• C)$748,500
• D)$1,080,000
• E)$1,629,600

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Definitions:

Celler-Kefauver Act

A U.S. law enacted in 1950 aimed at preventing anti-competitive mergers and acquisitions that could lead to decreased competition.

Civil Aeronautics Board

A former federal agency in the United States responsible for regulating the air transport industry until its deregulation in the early 1980s.

Sherman Act

An 1890 United States antitrust law that outlaws monopolistic practices and promotes competition.

Price-fixing

An illegal agreement among competitors to set prices at a certain level, rather than competing naturally in the market.