What is the new annual breakeven test quantity

Reference no: EM131004454

Suppose the Service reduces its personnel costs to $100,000 per year and the per sample cost to $20. What will this do to the breakeven point? (Hint: Again, look carefully at your graph from the pre- vious problem before answering.) What is the new annual breakeven test quantity?

per hour. Machine 2 costs $70,000, has a life of 6 years, an annual cost of $2500, and requires two operators at a cost of $24 per hour each. It can process 6 tons per hour.

a. Determine the breakeven tonnage of scrap metal at i = 7% per year and select the better machine for a processing level of 1000 tons per year.

b. Calculate and plot the sensitivity of the break- even tons per year to ±15% change in the hourly cost of an operator.

Reference no: EM131004454

Questions Cloud

Balance of the purchase price : They will borrow the balance of the purchase price from a local bank. Advise Jacqui and Joanne on a choice of business form. Consider that the enterprise is expected to realize operating losses of $50,000 annually for the first 3 years. During the..

Determine the breakeven quantity : Labor and other operating costs are es- timated to be $35,000 per year over the study pe- riod of 5 years. Salvage is estimated at 10% of first cost and i = 12% per year. Neglect the element of availability (a) to determine the breakeven quantity,..

Planned incorporation of the club : He has learned that to form a corporation, it must have a clear business purpose, and wonders whether forming a corporation merely to acquire a special liquor license sat- isfies the business purpose requirement. Write a letter to Ruiz that addres..

Effective communication in a business environment : Effective communication skills are essential in the workplace. Some businesses invest in training their employees on how to effectively communicate, because effective communication skills go beyond conversations.

What is the new annual breakeven test quantity : Suppose the Service reduces its personnel costs to $100,000 per year and the per sample cost to $20. What will this do to the breakeven point? (Hint: Again, look carefully at your graph from the pre- vious problem before answering.) What is the ne..

Provide therapy for patients in hospitals : He also contracts with other organizations to provide therapy for patients in hospitals and members of churches and other nonprofit organizations. He anticipates that he will need two offices and will need to hire staff to help with phone calls, a..

Determine breakeven square footage using contract period : Over the last several years the equivalent annual cost at 8% per year has been $28,000. A subcontractor will perform all field painting for an initial fee of $100,000 for a 5-year contract and an add- on rate of $5.00 per 100 sq ft per coat (laye..

Amount of deductible casualty loss : The insurance adjuster estimates that the damaged cab is worth $3,600. Although a comparable cab sells for $7,800, the insurance company gives Stella only $2,900. Write a letter to Stella explaining the amount of her deductible casualty loss.

Allowable casualty loss deduction : Gordon is the sole proprietor of Fashion Flowers & Florals (FFF). During the current year, one of FFF's delivery vans is involved in an automobile accident. The van has a basis of $6,000. What is FFF's allowable casualty loss deduction under each ..

User Account

All Pages