A national retailer is looking at putting in a warehouse in one of several locations. Each location has a fixed and variable costs listed in the table below. Management is interested in knowing which location is best but has no forecast of demand, they want to know which location is best for a given volume. You will need to find the break even points between A, B, C & D. To answer the question completely, at what values (volumes) is one location better than another.
|
Locations
|
Fixed Costs
|
Variable Costs
|
|
A
|
70,000
|
26
|
|
B
|
120,000
|
21
|
|
C
|
190,000
|
20
|
|
D
|
200,000
|
18
|