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SECTION A-PRUULUT s considering two possible options to extend its brewing A distillery is considering two possip operations: - Install a new 50.000 litres per
SECTION A-PRUULUT s considering two possible options to extend its brewing A distillery is considering two possip operations: - Install a new 50.000 litres per year whiskey plan - Install a new 100,000 litres per year whiskey (a) Using the data below to draw a breakeven chart an breakeven production rate for both options a below to draw a breakeven chart and calculate the DE (15 marks) ate the gross profit and net profit for both options running at 100% capacity (6 marks) (c) Which is the best option: 50.000 litres per year or 100,000 litres per year and why? (4 marks) DATA Whisky selling price Production cost scale factor Income tax rate 16/litre 0.5 20% For the 50.000 litres/y plant: Variable production cost Fixed production cost 6/litre 4.8/litre
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