Hello,

I am currently having difficulties with solving this problem. This is a problem based on managerial accounting. Thank you for your patience, time, and help.

Payne Company sells shoes which are made in the USA. Current data per month is as follows: Selling Price $60.00 Variable Cost Per Unit $30.00 Monthly Fixed Costs $100,000 Units Sold 5,000 Payne has the opportunity to shift production overseas. The overseas manufacturer would charge a monthly fee of $120,000 to make all of the shoes, thus eliminating all of the variable costs. Required Calculate the net income and the break-even in units using the current data. Calculate the net income and the break-even in units assuming Payne shifts production overseas. Should Payne shift production overseas? Explain your answer using numbers from your calculations. In addition to your calculations, what else could be considered when making this decision? Current Shift Production Net Income Break-Even in Units Conclusion