1) A project has the following information. Price is $62 per unit, variable cost is $41...

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1) A project has the following information. Price is $62 perunit, variable cost is $41 per unit, fixed costs is $15500,required return is 12%, initial investment $24000, project life is4 years. Ignoring taxes,
What’s accounting breakeven
What’s cash breakeven
What’s financial breakeven?
What’s DOL at financial breakeven level?
2) A stock has a beta of 1.05. The expected return of the marketis 10%, and risk free rate is 3.8%.
What’s the expected return of the stock?
3) Holdup bank has an issue of preferred stock with a 4.25stated dividend and its selling for $92 per share. What’s the costof its preferred?
4) Molineux corp. has market value of equity at $20 billion, andits debt book value is $4 billion. Its cost of equity is 12%, andpretax cost of debt of 7%. Its tax rate is 35%.
What’s the company’s capital structure?
What’s the after tax cost of debt?
What’s the company’s WACC?

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4.2 Ratings (706 Votes)

1 Calculation of accounting breakeven Accounting breakeven Fixed costsDepreciationContribution margin per unit Depreciation 240004 6000 Contribution margin 6241 21 Accounting breakeven 15500600021 Accounting breakeven 1023809524 The accounting breakeven is 1024 units Calculation of cash breakeven Cash breakeven Fixed costsContribution margin per unit Cash See Answer

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1) A project has the following information. Price is $62 perunit, variable cost is $41 per unit, fixed costs is $15500,required return is 12%, initial investment $24000, project life is4 years. Ignoring taxes,What’s accounting breakevenWhat’s cash breakevenWhat’s financial breakeven?What’s DOL at financial breakeven level?2) A stock has a beta of 1.05. The expected return of the marketis 10%, and risk free rate is 3.8%.What’s the expected return of the stock?3) Holdup bank has an issue of preferred stock with a 4.25stated dividend and its selling for $92 per share. What’s the costof its preferred?4) Molineux corp. has market value of equity at $20 billion, andits debt book value is $4 billion. Its cost of equity is 12%, andpretax cost of debt of 7%. Its tax rate is 35%.What’s the company’s capital structure?What’s the after tax cost of debt?What’s the company’s WACC?