Case study of markland manufacturing

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Reference no: EM1393953

Markland 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.

a. What is the break-even point in dollars for proposal A, if you add $10,000 installation to the fixed cost?

b. What is the break-even point in dollars for proposal B, if you add $10,000 installation to the fixed cost?

Reference no: EM1393953

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