$7.17 Sroufe Manufacturing intends to increase capacity by overcoming a bottleneck operation by adding new equipment. Two vendors have presented proposals. The fixed costs for proposal A are $50,000, and for proposal B, $70,000. The variable cost for A is $12.00, and for B, $10.00. The revenue generated by each unit is $20.00. 1. What is the break-even point in units for proposal A? 2. What is the break-even point in units for proposal B?

Marketing
20th Edition
ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
Section: Chapter Questions
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• $7.17 Sroufe Manufacturing intends to increase capacity by overcoming a bottleneck operation
by adding new equipment. Two vendors have presented proposals. The fixed costs for proposal
A are $50,000, and for proposal B, $70,000. The variable cost for A is $12.00, and for B, $10.00.
The revenue generated by each unit is $20.00.
1. What is the break-even point in units for proposal A?
2. What is the break-even point in units for proposal B?
Transcribed Image Text:• $7.17 Sroufe Manufacturing intends to increase capacity by overcoming a bottleneck operation by adding new equipment. Two vendors have presented proposals. The fixed costs for proposal A are $50,000, and for proposal B, $70,000. The variable cost for A is $12.00, and for B, $10.00. The revenue generated by each unit is $20.00. 1. What is the break-even point in units for proposal A? 2. What is the break-even point in units for proposal B?
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ISBN:
9780357033791
Author:
Pride, William M
Publisher:
South Western Educational Publishing