Increase capacity through the addition of new equipment

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Reference no: EM131479518

Tom Johnson Manufacturing intends to increase capacity through the addition of 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) If the expected volume is? 8,500 units, _______(proposal A or proposal B) with a total profit = $______ should be chosen ?(enter your response as a whole? number).

Reference no: EM131479518

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