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Edifer Tools, Inc. uses a semi-automated process in its production. It is faced with a proposal to completely automate its production. Below are data
Edifer Tools, Inc. uses a semi-automated process in its production. It is faced with a proposal to completely automate its production. Below are data for these alternative methods: Complete Automation Semi- Automated Materials cost per unit P12.00 P10.50 Labor cost per unit 3.00 15.00 Other variable cost per unit 4.50 3.00 Lease cost per year 75,000 30,000 Maintenance cost per 15,000 6,000 year The cost indifference point is at 3,300 units 6,300 units 3,000 units 6,000 units
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