a) Compute the total costs for each location if the company is expected to produce 2500 units of desk lamp. Which location should they choose?

 

b) Determine which location will generate more profit for a production volume of 4000 units?

 

c) At what volume that Perlis should be chosen as the best location to produce the lamp with minimum costs?

Hana Electronics is considering two different locations in the Northern Zone of Malaysia for their new factory to produce LED desk lamp. Each unit of lamp is expected to be sold at RM210. The cost structure for each location can be seen in Table2. Location Perlis Kedah Fixed Costs (RM) 100,000 130,000 Variable costs (RM) / Unit 150 130