Assume that you and your brother plan to open a business that will make and sell a newly
Assume
that you and your brother plan to open a business that will make and
sell a newly designed type of sandal. Two robotic machines are available
to make the sandals, Machine A and Machine B. The price per pair will
be $19.50 regardless of which machine is used. The fixed and variable
costs associated with the two machines are shown below. What is the
difference between the breakeven points for Machines A and B? (Hint: Find BEB - BEA)
Machine A
Price per pair (P) $19.50
Fixed costs (F) $25,000
Variable cost/unit (V) $7.00
Machine B
Price per pair (P) $19.50
Fixed costs (F) $100,000
Variable cost/unit (V) $4.00
Answer
3,784
4,318
3,739
4,674
4,452
Price per pair (P) $19.50
Fixed costs (F) $25,000
Variable cost/unit (V) $7.00
Machine B
Price per pair (P) $19.50
Fixed costs (F) $100,000
Variable cost/unit (V) $4.00
Answer
3,784
4,318
3,739
4,674
4,452
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