The difference between an NPV break-even level of sales and an accounting break-even level of sales is:
A)the consideration of opportunity cost.
B)the consideration of depreciation expense.
C)allowing the sales level to vary in response to changes in demand.
D)the inclusion of income taxes.

Question

Quizplus · Accepted Answer

The NPV break-even level of sales takes into account the opportunity cost of funds invested in the project, while the accounting break-even level of sales does not. Depreciation expense and income taxes may be factors in both calculations, and allowing sales level to vary in response to changes in demand can also be considered in both.

The Difference Between an NPV Break-Even Level of Sales and an Accounting