a) What is the accounting break-even point if each shirt costs $6.50 to make and you can sell them for $13 apiece?
Now assume one year has passed and you have sold 5,000 shirts! You find out that the Dairy Farmers of America have copyrighted the “got milk” slogan and are requiring you to pay $15,000 to continue operations. You expect this craze will last for another three years and that you discount rate is 12 percent.
b) What is the financial break-even point for your enterprise now?
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