contestada

Sroufe Manufacturing intends to increase capacity by overcoming a bottleneck operation by adding new equipment. Two vendors have presented proposals. The fixed costs are $ 60 comma 000 for proposal A and $ 70 comma 000 for proposal B. The variable cost is $ 13.00 for A and $ 9.00 for B. The revenue generated by each unit is $ 24.00. ​a) The​ break-even point in units for the proposal by Vendor A​ = nothing units ​(round your response to the nearest whole​ number). ​b) The​ break-even point in units for the proposal by Vendor B​ = nothing units ​(round your response to the nearest whole​ number).

Respuesta :

Answer:

(A) 5,455 units

(B) 4,667 units

Explanation:

In this question we use the formula of break-even point in unit sales which is shown below:

= (Fixed cost) ÷ (Contribution margin per unit)

where,  

Contribution margin per unit = Selling price per unit - Variable expense per unit

(A) For Vendor B

The Break-even point in units = ($60,000) ÷ ($24 - $13)

                                                  =  ($60,000) ÷ ($11)

                                                  = 5,455 units

(B) For Vendor B

The Break even point in units = ($70,000) ÷ ($24 - $9)

                                                  =  ($70,000) ÷ ($15)

                                                  = 4,667 units

Otras preguntas