What is the company's current breakeven in units and in dollars?

If the company expects to sell $750$ premium garage doors in the

upcoming year, and it does not develop the software control system, what is

its expected operating income from premium garage doors?

If the software control system were to be developed and implemented, what

would be the company's new breakeven point in units and in dollars?

If the company expects to sell $750$ premium garage doors in the

upcoming year, and it develops the software control system, what is its

expected operating income from premium garage doors?

If the company expects to sell $750$ premium garage doors in the

upcoming year, do you think the company should implement the software

control system? Why or why not? What factors should the

company consider? Data table

More info

Kerrigan 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

manufacturing operations, the use of the software control system would result in an

increase of $$50,000$ in its annual fixed costs while the average variable

manufacturing cost per door would drop by $$100.$ Kerrigan Garage Doors manufactures a premium garage door. Currently, the price and cost data associated with the premium garage door are as follows:

$($Click the icon to view the data.$)$

$(($Click the icon to view more information.$)$

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Requirement $1.$ What is the company's current breakeven in units and in dollars?

Begin by identifying the formula to compute the breakeven sales in units using the contribution margin approach.

The breakeven point in units is

units.

The breakeven point in dollars is

Requirement $2.$ If the company expects to sell $750$ premium garage doors in the upcoming year, and it does not develop the software control system, what is its expected operating income from

premium garage doors?

Begin by identifying the formula to compute the operating income.

Sales revenue

Variable expenses

Fixed expenses

Operating income

If the company expects to sell $750$ garage doors, and it does not develop the software control system, its expected

operating income is