(B) basing on the information above in (a), the society is considering to buy new production equipment. The new equipment will increase fixedcost by tsh 181,400,000 per annum and will reduce variable cost for high quality by Tsh9000 and low quality by Tshs 5000 per unit. REQUIRED: (i) compute breakeven points in terms of unit of each product and indicate how many unit of each filter should be manufacture and sold to earn a target profit of tsh 28,160,000 per annum.(ii) Determine the point of indeffernce btwn using the old equipment and new equipment.(iii) if total sales are expected to be 30000 units per annum, should the society buy new equipment? Show computation.

(a) Kangaroo Cooperative society manufactures and sells two types of water filters i.e high quality and low quality filters by suing its old equipment. The cost structure of the water filters are: Type of water filter High Quality Low Quality Selling price per unit 90,000 25,000 Variable costs per unit 80,000 20,000 The sales mix in units are in the ratio of 3:2 for high quality and low quality respectively. The fixed costs per annum are Tshs. 945,000,000. Laurian, Vicent CPA(T), MSc. @