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Determine the alternative break-even point in units

Assignment:

A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two alternatives, A and B, have been identified, and the associated costs and revenues have been estimated. Annual fixed costs would be $39,000 for A and $30,000 for B; variable costs per unit would be $10 for A and $11 for B; and revenue per unit would be $15.

a. Determine each alternative's break-even point in units. (Round your answer to the nearest whole amount.)

b. At what volume of output would the two alternatives yield the same profit? (Round your answer to thenearest whole amount.)

c. If expected annual demand is 16,000 units, which alternative would yield the higher profit?

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## Q : The volume of output at which both the locations have the

hugh leach corp a producer of machine tools wants to move to a larger site two alternative locations have been