You are considering two options for producing a product

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Reference no: EM13602645

You are considering two options for producing a product that will sell for $100.Option 1 will have variable cost $50, and a fixed cost of $60,000.Option 2 will have a variable cost of $40 and fixed cost of $78,000.Prepare a profit volume graph with units produced and sold on the independent axis.Show both options on the graph.Clearly indicate the numerical value of

(1) the slope of each line,

(2) the breakeven values, and

(3)the unit volume where both options result in the same operating income.Which option would you prefer if you planned to produce and sell between 1,600 and 1,700 units?

Reference no: EM13602645

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