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Mathematics, 07.09.2021 01:00 naomiedgrey
An electronics firm is currently manufacturing an item hat has a variable cost of $0.50 per unit and a selling price of $1.10 per unit. Fixed costs are $14,000.
Current volume is 35,000 units. The firm can substantially improve the product quality by adding a new piece of equipment at an additional fixed cost of $6,000 . Variable cost would increase to $0.60 , but volume should jump to 50,000 units due to a higher-quality product.
Based on the given information, the decision should be to:
A. For Smithson Cutting, the break-even point in units = ?
B. For Smithson Cutting, the break-even point in dollars =?
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