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What next years production requirement will be

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Question

X Company spent $7,300 on an engineering study that revealed that Product A could be manufactured more efficiently, resulting in variable cost savings of $0.71 per unit. However, there would be an increase in fixed costs of $3,230. Current variable costs per unit are 3.67, and current fixed costs are $10,200. The current selling price is $11.82.

X Company's operations manager is uncertain what next year's production requirement will be. How many required units would make X Company indifferent between adopting the new process and not adopting it?

Reference no: EM132315433

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