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Walton Ltd. is considering replacing an existing machine with a new and faster machine that will produce a more reliable product (i.e.; better tolerances). The
Walton Ltd. is considering replacing an existing machine with a new and faster machine that will produce a more reliable product (i.e.; better tolerances). The switch to a new machine resulting in a superior product is expected to allow Walton to increase its sale price for the product. The switch will increase fixed costs, but not the variable costs. The cost and revenue estimates are as follows: Required: Determine the break-even point in units for the two machines. (Round your answers to the nearest whole number.) Determine in units the sales level at which the new machine will achieve a 10 percentage target profit-to-sales ratio (ignore taxes). (Do not round intermediate calculations.) Determine the sales level at which profits will be the same for either the old or the new machine. (Round intermediate calculations to 4 decimal places and final answers to the nearest whole number.)
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