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Ferguson Inc. is considering investing in technology that would increase fixed costs by $275,000 and decrease variable costs by 15%. As a result of this
Ferguson Inc. is considering investing in technology that would increase fixed costs by $275,000 and decrease variable costs by 15%. As a result of this change, Ferguson's breakeven point will change from 9,000 units to 9,500 units. Current sales are 9,800 units per year and are expected to grow by 5% each year for the next five years. Should Ferguson make this change? No, the breakeven point will be higher. Yes, the breakeven point will be higher which will decrease risk
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