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How do I figure out the operating income at 116,000 units and 216,000 units to this story problem. International Data Systems' information on revenue and
How do I figure out the operating income at 116,000 units and 216,000 units to this story problem.
International Data Systems' information on revenue and costs is relevant only up to a sales volume of 116,000 units. After 116,000 units, the market becomes saturated and the price per unit falls from $18.00 to $10.80. Also, there are cost overruns at a production volume of over 116,000 units, and variable cost per unit goes up from $9.00 to $9.50. Fixed costs remain the same at $66,000
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