Perfect Furniture is a manufacturer of kitchen tables and chairs. The company is currently deciding between two

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Perfect Furniture is a manufacturer of kitchen tables and chairs. The company is currently deciding between two new methods for making kitchen tables. The first process is estimated to have a fixed cost of $87,000 and a variable cost of $70 per unit. The second process is estimated to have a fixed cost of $110,000 and a variable cost of $60 per unit.

a) Graphically plot the total costs for both methods. Identify which ranges of product volume are best for each method.

b) If the company produces 500 tables a year, which method provides a lower total cost?

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