Cool Shades manufactures biotech sunglasses. The variable materials cost is $1.38 per unit, and the variable labor cost is $.92 per unit. Suppose the firm incurs fixed costs of $348,000 during a year in which total production is 136,000 units and the selling price is $19.50 per unit. What is the cash break-even point?

A project will require spending $2,300,000 on new fixed assets that will be depreciated on a straight-line basis to a value of zero over five years, at which point the assets will be worthless. The project involves selling new products for $36,000 per unit, with a variable cost of $22,000 per unit. Annual fixed costs are expected to be $425,000. The company uses a 20 percent discount rate. What is the financial break-even point?

The Corner Store factors all of its receivables immediately at a discount rate of 1.1 percent. The average collection period is 37.4 days and default is unlikely. What is the effective cost of borrowing?

Project A has cash flows of −$50,000, $49,400, $27,200, and $24,500 for Years 0 to 3, respectively. Project B has an initial cost of $50,000 and an annual cash inflow of $18,500 for four years. These are mutually exclusive projects. What is the crossover rate?

A stock had returns of 2 percent, −23 percent, and 13 percent over the past three years. What is the geometric average return for this time period?

One year ago, you purchased 100 shares of Bailey Homes stock at a price of $37.78 per share. The company pays a quarterly dividend of $1.85 per share. Today, you sold for the shares for $28.30 per share. What is your total percentage return on this investment?

Schubach Ranch Supply offers its credit customers a two percent discount if they pay within ten days. This discount is referred to as a ____ discount.

Rosa’s has a weighted average cost of capital of 11.73 percent. The cost of equity is 15.8 percent and the pretax cost of debt is 7.6 percent. The tax rate is 21 percent. What is the target debt-equity ratio?

Projects A and B are mutually exclusive. Project A has cash flows of −$10,000, $5,100, $3,400, and $4,500 for Years 0 to 3, respectively. Project B has cash flows of −$10,000, $4,500, $3,400, and $5,100 for Years 0 to 3, respectively. What is the crossover rate for these two projects?

Hall Service Corporation is considering a project that will require $39,000 in net working capital and $68,000 in fixed assets. The project is expected to produce annual sales of $78,500 with associated cash costs of $41,000. The project has a four-year life. The company uses straight-line depreciation to a zero book value over the life of the project. Ignore bonus depreciation. The tax rate is 25 percent. What is the operating cash flow for this project?