Reference no: EM13160478
Cesar's Bottlers bottles soft drinks in a factory that can operate either one shift, two shifts, or three shifts per day. Each shift is eight hours long. The factory is closed on weekends. The sales price of $2 per case bottled and the variable cost of $0.90 per case remain constant regardless of volume. Cesar's Bottlers can increase volume by opening and staffing additional shifts. The company has the following three choices:
Daily Volume Range Total Fixed Costs
(Number of Cases Bottled) per Day
1 Shift (0-2,000) $1,980
2 Shifts (2,001-3,600) 3,740
3 Shifts (3,601-5,000) 5,170
A. Calculate the break-even point(s)
B. If Cesar's Bottlers can sell all the units it can produce, shoud it operate ar one, two, or three shifts? Support your answer.
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: A. Calculate the break-even point(s) B. If Cesar's Bottlers can sell all the units it can produce, shoud it operate ar one, two, or three shifts? Support your answer.
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