For the following questions, assume no taxes and straight-line depreciation.
a. What is the cash break-even quantity, and how is it calculated? Use both words and an equation in your explanation. Include a discussion of payback period, NPV, and IRR at the cash break-even sales level.
b. What is the accounting break-even quantity, and how is it calculated? Use both words and an equation in your explanation. Include a discussion of payback period, NPV, and IRR at the accounting break-even sales level.
c. What is the financial break-even quantity, and how is it calculated? Explain using both words and an equation. Make sure that you discuss the two steps involved in finding the financial break-even point. Also, include a discussion of discounted payback period, NPV, and IRR at the financial break-even sales level.