Which of the following may be responsible for a fair share ofthe perennial “project cost overruns”?Rapidly rising inflationDelays in obtaining contracts and permitsLack of raw materialsForecasting bias by the sponsoring managerA firm with 50% of sales going to variable costs, $1.6 millionfixed costs, and $510,000 depreciation would show what accountingprofit with sales of $4 million? Ignore taxes.rev: 07_27_2012$800,000 lossZero loss$110,000 loss$400,000 lossA firm with $780,000 fixed costsand $380,000 depreciation is expected to produce $405,000 inprofits. What is its DOL? (Do not round intermediatecalculations.)3.862.933.932.86When the level of fixed costs is decreased, the break-even levelof revenues:will automatically decrease.will automatically increase.may or may not be changed, depending on variable costs.will remain unchanged, because fixed costs cannot bealtered.If a decision tree indicates an expected NPV of $1 million,then:at least one of the outcomes had a negative NPV.all of the outcomes had a positive NPV.$1 million is the firm’s minimum guaranteed profit.the project still contains uncertainty.If forecasted sales exceed the break-even level but are lessthan the economic break-even level, the project has a:positive NPV but earns less than the discount rate.negative NPV but earns more than the discount rate.net loss on the income statement.net profit on the income statement.What is the accounting break-even level of revenues for a firmwith $9 million in sales, variable costs of $5.4 million, fixedcosts of $1.4 million, and depreciation of $1 million? (Donot round intermediate calculations.)$7,500,000$6,000,000$7,800,000$3,500,000What happens to the NPV of aone-year project if fixed costs are increased from $550 to $900,the firm is profitable, has a 40% tax rate, and employs a 11% costof capital?NPV decreases by $210.00.NPV decreases by $189.19.NPV decreases by $350.00.NPV decreases by $315.32.Calculate the ratio of variablecosts to sales for a firm with $3,900,000 accounting break-evenrevenues, $1.6 million fixed costs, and $740,000 depreciation.60%41%40%59%