TVM Problem:
Suppose the annual cost in Question #1 is all the fixed costs. And the variable costs of producing mechanical parts your company designed are $19.0/unit, and the selling price is $20.0/unit. How many units per year your company will need to produce to break even every year?
Referenced Question #1:
Your company plans to purchase a milling machine at a cost of $260,000 with a service life of 8 years. It has a salvage value of $40,000 at the end of the 8th year. What is the annual cost of this machine considering the interest rate of 7% per year?