Answered step by step
Verified Expert Solution
Question
1 Approved Answer
1) Two production processes A and B have the following cost structure as sh in the diagram below: (15 min) Gurmanjit Sin Process Fixed Cost
1) Two production processes "A and B" have the following cost structure as sh in the diagram below: (15 min) Gurmanjit Sin Process Fixed Cost Variable Cost per Unit per Year List of formulas: Profit = Revenue - Total cost Revenue = Selling price volume Total cost = Fixed cost + cost per item volume A $120,000 $3.00 B 90,000 4.00 Zahra Mahya Break even volume = (Fixed cost)/ (Unit contribution margin) a Calculate the break even number of products associated with each process Visharder assuming the selling price of $10. (4 marks) b. Calculate the minimum number of products which must be produced (min volume) to make process "A" more economic than process "B". (4 marks) c. Calculate the expected profit/loss for the volume of 9000 units if selling price is $10.(4 marks)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started