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Stapleton Manufacturing intends to increase capacity through the addition of new equipment. Two...

Stapleton Manufacturing intends to increase capacity through the addition of new equipment. Two vendors have presented proposals. The fixed cost for proposal A is $65,000, and for proposal B, $34,000. The variable cost for A is $10, and for B, $14. The revenue generated by each unit is $18.

a) What is the crossover point in units for the two options?

b) At an expected volume of 8,300 units, which alternative should be chosen?

 

Jul 30 2020 View more View Less

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