stering Feedback Studio Assignments Blueline Printing Company currently leases its only copy machine for $1,600 a month. The company is considering replacing this leasing agreement with a new contract that is entirely commission based. Under the new agreement, Blueline would pay a commission for its printing at a rate of $10 for every 500 pages printed. The company currently charges $0.29 per page to its customers. The paper used in printing costs the company $0.09 per page and other variable costs, including hourly labor, amount to $0.12 per page. Read the requirements. Requirement 1. What is the company's breakeven point under the current leasing agreement? W First, determine the formula used to calculate the breakeven point in units, then calculate the com Contribution margin per unit = Breakeven number $ Fixed costs 1,600 0.08 20,000 What is it under the new commission-based agreement? (Enter a "0" for any zero balances.) The company's breakeven point under the new commission-based agreement is 0 Requirement 2. For what range of sales levels will Blueline prefer (a) the fixed lease agreement In order to determine the range of sales levels Blueline would prefer for each agreement, we mu The indifference point = sales volume at which the income from alternative 1 equals the incom Now calculate the indifference point. (Round to the nearest whole number.) Requirements 1. What is the company's breakeven point under the current leasing agreement? What is it under the new commission-based agreement? 2. For what range of sales levels will Blueline prefer (a) the fixed lease agreement and (b) the commission agreement? Blueline estimates that the company is equally likely to sell 17,500, 27,500, 37,500, 47,500, or 57,500 pages of print. Using information from the original problem, prepare a table that shows the expected profit at each sales level under the fixed leasing agreement and under the commission-based agreement. What is the expected value of each agreement? Which agreement should Blueline choose? The indifference point is at units. Print Done