Assume that you and your brother plan to open a business

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Assume that you and your brother plan to open a business that will make and sell a newly designed type of sandal. Two robotic machines are available to make the sandals, Machine A and Machine B. The price per pair will be $19.50 regardless of which machine is used. The fixed and variable costs associated with the two machines are shown below. What is the difference between the breakeven points for Machines A and B? (Hint: Find BEB - BEA)

Machine A

  1. Price per pair (P) $19.50
  2. Fixed costs (F) $25,000
  3. Variable cost/unit (V) $7.00

Machine B

  1. Price per pair (P) $19.50
  2. Fixed costs (F) $100,000
  3. Variable cost/unit (V) $4.00
  • 3,784
  • 4,318
  • 3,739
  • 4,674
  • 4,452

Reference no: EM13473522

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