A Project Has an Accounting Break-Even Point of 15,329 Units

question 79

Multiple Choice

A project has an accounting break-even point of 15,329 units.The fixed costs are $382,000 and the projected variable cost per unit is $29.10.The project will require $780,000 for fixed assets which will be depreciated straight-line to zero over the project's 6-year life.What is the projected sales price per unit?

• A)$47.65
• B)$48.18
• C)$54.02
• D)$56.67
• E)$62.50

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Definitions:

Chattel Paper

A document or records indicating both a monetary obligation and a security interest in or lease of specific goods.

Collateral

Assets or property offered as security for a loan, to be forfeited in the event of default.

Perfected Purchase

A legal status in property law where the buyer obtains the rights to the property free from any prior claims or liens.

Money Security Interest

A legal claim or lien on collateral (such as cash or deposit accounts) provided by a debtor to secure a loan or other credit, ensuring the lender has a priority claim over the funds in the case of default.