Question
Indigo Corporation currently leases a processing machine. They believe they can reduce their total fixed costs from $1,200,000 to $1,000,000 by cancelling their lease, and
Indigo Corporation currently leases a processing machine. They believe they can reduce their total fixed costs from $1,200,000 to $1,000,000 by cancelling their lease, and hiring independent contractors to handle processing at a cost of $25 per unit processed. They dont believe the change will affect customer satisfaction at all. A Cost-Volume-Profit Analysis would suggest cancelling the lease is the correct decision if:
They need more than 48,000 units | ||
They need fewer than 48,000 units | ||
They need more than 40,000 units | ||
They need fewer than 40,000 units | ||
They need more than 8,000 units | ||
They need fewer than 8,000 units |
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