A manufacturing company preparing to build a new plant is considering three potential locations for it. The fixed and variable costs for the three alternative locations are presented below.
Costs A B C Fixed ($) 2,200,000 2,000,000 4,500,000 Variable ($ per unit) 22 26 19
a. Complete a numeric locational cost-volume analysis to determine break even points for all three locations. :
b. Plot a graph of break-even analysis:
c. Based on your graph, indicate over what range the volume for each of the alternatives A, B, C is the low-cost choice. :