CopyFast is a company that competes for copy services business with Staples. They are considering two different copiers to do large format copying. If they get either machine, they will sell large-format copies for $0.20 each. The quality is the same, but the costs they pay are different. The costs for the two machines are:
ColorMaster SuperColor
Annual Rent $ 12,000 $40,000
Paper (per copy) $0.02 $0.02
Other variable (per copy) $0.08 $0.03
1. many copies would they have to sell each year to break even if they choose the ColorMater?
2. How many copies would they have to sell each year to break even if they choose the SuperColor?
3. If CopyFast is confident that they will sell 500,000 copies next year, which machine.should they use?
4. At what volume of copies would they have the same total cost for both machines?