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Also, please include SALES PRICE PER UNIT. What is the number for this? Exercise 3-13A (Algo) Conducting sensitivity analysis using the equation method LO 3-5
Also, please include SALES PRICE PER UNIT. What is the number for this?
Exercise 3-13A (Algo) Conducting sensitivity analysis using the equation method LO 3-5 Jordan Company currently produces and sells 6,500 units annually of a product that has a variable cost of $17 per unit and annual fixed costs of $275,000. The company currently earns a $76,000 annual profit. Assume that Jordan has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $15 per unit. The investment woulc cause fixed costs to increase by $9,400 because of additional depreciation cost. Required a. Use the equation method to determine the sales price per unit under existing conditions (current equipment is used). b. Prepare a contribution margin income statement, assuming that Jordan invests in the new production equipment. Complete this question by entering your answers in the tabs below. Prepare a contribution margin income statement, assuming that Jordan invests in the new production equipmentStep by Step Solution
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