1. New England Wire and Cable is looking at a project with an accounting break-even production quantity of 17,920 units. The fixed costs are $216,000 and the contribution margin per unit is $27.33. 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?
2. At an output level of 10000 units, you have calculated that the degree of operating leverage is 2.21. The operating cash flow is $40,000 in this case. Ignoring the effect of taxes, what are fixed costs?