Question
Kirby Kirby Garage Doors manufactures a premium garage door.Currently, the price and cost data associated with the premium garage door are asfollows: Average selling price
Kirby
Kirby Garage Doors manufactures a premium garage door.Currently, the price and cost data associated with the premium garage door are asfollows:
Average selling price per premium garage door
. . . . . . . .
$
1,600
Average variable manufacturing cost per door
. . . . . . . . .
$
700
Average variable selling cost per door
. . . . . . . . . . . . .
$
260
Total annual fixed costs
. . . . . . . . . . . . . . . . . . . . . . . . . . .
$
224,000
Kirby
Kirby Garage Doors has undertaken several sustainability projects over the past few years. Management is currently evaluating whether to develop a comprehensive software control system for its manufacturing operations that would significantly reduce scrap and waste generated during the manufacturing process. If the company were to implement this software control system in its manufacturingoperations, the use of the software control system would result in an increase of $ 72 comma 000
$72,000 in its annual fixed costs while the average variable manufacturing cost per door would drop by $ 160
$160.
The breakeven point in units is ?
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