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Breakeven time for new product development Greyson Technology is launching a new digital communications device. Specifically, assume the following: Y1, Q1 Y1, Q2 Y1, Q3
Breakeven time for new product development
Greyson Technology is launching a new digital communications device. Specifically, assume the following:
Y1, Q1 | Y1, Q2 | Y1, Q3 | Y1, Q4 | Y2, Q1 | Y2, Q2 | Y2, Q3 | Y2, Q4 | Y3, Q1 | |
---|---|---|---|---|---|---|---|---|---|
Market research (000) | ($90) | ($45) | |||||||
Product development (000) | ($72) | ($135) | ($135) | ($135) | ($135) | ($135) | ($135) | ($54) |
Y3, Q1 | Y3, Q2 | Y3, Q3 | Y3, Q4 | Y4, Q1 | Y4, Q2 | Y4, Q3 | Y4, Q4 | |
---|---|---|---|---|---|---|---|---|
Selling price | $16 | $15 | $15 | $14 | $14 | $14 | $14 | $14 |
Sales quantity (000) | 18 | 27 | 36 | 41 | 41 | 32 | 27 | 18 |
After Y4, Q4, the competitive price is expected to remain at $14 and the maximum sales will be 18,000 units. Required Assuming that the cost per unit remains $9 and the MSDA expenses remain $108,000 per quarter, determine the breakeven time metric. Breakeven time metric AnswerNeverY3, Q1Y3, Q2Y3, Q3Y3, Q4Y4, Q1Y4, Q2Y4, Q3Y4, Q4
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