Question
sheridans candles will be producing a new line of dripless candles in the coming years and has the choice of producing the candles in the
sheridans candles will be producing a new line of dripless candles in the coming years and has the choice of producing the candles in the coming years and has the choice of producing the candles in a large factory with a small number of workers or a small factory with a large number of workers. Each candle will be sold for 10$. If the large factory is chosen, the cost per unit to produce each candle will be $2.40. The cost per unit will be $7.00 in the small factory . The large factory would have fixed cash costs of 1.6 million and a depreciation expense of $300,000 per year, while those expenses would be $470,000 and $100,000, respectively in the small factory. Calculate the accounting operating profit break-even point for both factory choices for sheridan's candles.
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