Breakpoint Even

Question: The management of Health Supplement Inc. wants to reduce its labor cost by installing a new machine. Two types of machines are available in the market – machine X and machine Y. Machine X would cost $18,000 where as machine Y would cost $15,000. Both the machines can reduce annual labor cost by $3,000.Required:Which is the best machine to purchase according to payback method?

Scholastic Tours is trying to decide which one of two tours It will introduce. The costs and revenues associated with each alternative are listed below: Projected revenue Variable costs Fixed costs Profit Multiple Choice What are the incremental (differential) costs of the Western Tour? $2,000. $3,000. Eastern Tour $16,000 2,000 3,000 $11,000 $6.000. Western Tour $18,000 8,000 3,000 $7,000 None of these choices are correct.

Turor, need your advice

Orlando Clinic has fixed costs of $800,000, a variable cost per visit of $60, and revenue per visit of $100. For this clinic (within the relevant range), which of the following statements is most correct? O Higher volume leads to higher total costs. O Higher volume leads to higher average costs. O Higher volume leads to a higher contribution margin per unit. O Higher volume leads to lower contribution margin per unit.

The following table contains selected data concerning the operation of the MHA Medical Center. Use the break-even formula and fill the missing information.

Saran Company has contacted Truckel with an offer to sell it 5,000 of the wickets for $18 each. If Truckel makes the wickets, variable costs are $16 per unit. Fixed costs are $8 per unit; however, $5 per unit is unavoidable. Should Truckel make or buy the wickets? a. Buy; savings = $15,000 b. Buy; savings = $5,000 c. Make; savings = $10,000 d. Make; savings = $5,000

A capitated managed care agreement with the city will bring in 400.00/month for 20 city employees, regardless if they are sick or not. Using differential cost analysis how do you calculate the full cost gain/loss and the differential cost gain/loss for two scenarios: keeping the agreement and killing the agreement?

Gateway Tours is choosing between two bus models. One is more expensive to purchase and maintain, but lasts much longer than the other. Gateway's discount rate is 9%. It plans to continue with one of the two models for the foreseeable future. Based on the equivalent annual costs of each, shown below, which should it choose? [Note: I have tried to make it easier for you to solve this problem. You do not need to do extra, unnecessary calculations merely to show me your work.] Model Year 0 Year 1 Year 2 Year 3 -$23 -$21 Year 4 Year 5 Year 6 Old R S &S $0 -$23 -$21 -$23 -$21 -$23 -$21 -$23 -$23 $0 Which bus should Gateway Tours choose? Give me the name of the bus that should be chosen, and the final numbers that justify your answer. Do not explain any concepts - I'm looking for an answer along the lines of "Choose because $ is better than $ [I'm sorry if the columns don't line up perfectly. Old R. is a 6 year project, and S&S is a 4 year project.] B I X, Insert Formula

Imaginationtime Park competes with Cool World by providing a variety of rides. Imaginationtime sells tickets at $60 per person as a​ one-day entrance fee. Variable costs are $24 per​ person, and fixed costs are $226,800 per month. Compute the contribution margin per unit and the number of tickets Imaginationtime Park must sell to break even. Perform a numerical proof to show that your answer is correct.Begin by selecting the formula labels and then entering the amounts to compute the contribution margin per unit.                         -                              = Contribution margin per unit   -   =   Begin by selecting the formula labels and then entering the amounts to compute the number of tickets Imaginationtime must sell to break even. ​(Abbrevision used: CM​ = contribution margin. Complete all input fields. For items with a zero​ value, enter​ "0".)     (       +   ) ÷   = Required sales in units  (…

You are considering opening a copy service in the student union. You estimate your fixed cost at $15,000 and the variable cost of each copy sold at $0.01. You expect the selling price to average $0.05. a) What is the break-even point in dollars? b) What is the break-even point in units?

Flavor Enterprises has been approached about providing a new service to its clients. The company will bill clients $170 per hour; the related hourly variable and fixed operating costs will be $80 and $14, respectively. If all employees are currently working at full capacity on other client matters, the per hour opportunity cost of being unable to provide this new service is: Multiple Choice $0. $76. $90. $94. $170.

What is the level of fixed costs ??

Gateway Tours is choosing between two bus models. One is more expensive to purchase and maintain but lasts much longer than the other. Gateway's discount rate is 11.1%. The company plans to continue with one of the two models for the foreseeable future. Based on the costs of each shown here:, which should it choose? (Note: dollar amounts are in thousands.) Based on the costs of each model, which should it choose? (Select the best choice below.) A. Gateway Tours should choose Short and Sweet because the NPV of its costs is smaller. B. Gateway Tours should choose Old Reliable because it lasts longer. O C. Gateway Tours should choose Short and Sweet because the equivalent annual annuity of its costs is smaller. D. Gateway Tours should choose Old Reliable because the equivalent annual annuity of its costs is smaller. Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Model Year 0 Year 1 Year 2 Year 3 Year 4 - $202 - $3.8 -$3.8 - $3.8 - $3.8 Old…

Need help

2. Two alternatives for a carwash business include a fully automatic systems at an initial cost of $200,000 with annual operating costs of $24,000 and a semi automatic system with an initial cost of $100,000 with annual operating costs of $36,000. The variable cost of each car wash is $2.5 for first alternative and $3.5 for the second alternative. What is the point of indifference between these two alternatives? MARR=10% and both systems work for 10 years.

San Juan Health Department's dental clinic projects the following costs and rates for the year 20XX.Total fixed costs: $225,000Variable costs: $60 per patientCharges: $250 per patient  Using the information above, determine the break-even point in patients?  Using the information above, determine the break-even point in dollars?  If the clinic decided it would like to make a profit of $8,000, what is the new break-even point in patients?  If the clinic decided it would like to make a profit of $8,000 at 1,226 patients, what is the new break-even point in dollars?

Derby Phones is Considering the Introduction of a new model of headphones with the following price and cost characteristics.    a) 73,000 b)decreases by 12,650     increases by 25,300 c) increases by 2750  decreases by 5500 D)*** having issues with

Ortega Company manufactures computer hard drives. The market for hard drives is very competitive. The current market price for a computer hard drive is $54. Ortega would like a profit of $14 per drive. What target cost Ortega should set to accomplish this objective? Target cost $ per hard drive

The Audiology Department at Randall Clinic offers many services to the clinic’s patients. The three most common, along with cost and utilization data, are as follows: Service Variable cost per service Annual Direct fixed Cost Annual number of visits Basic examination $5 $50,000 30,000 Advanced examination 7 30,000 1,500 Therapy section 10 40,000 500 What is the fee schedule for these services, assuming that the goal is to cover only variable and direct fixed costs? Assume that the Audiology Department is allocated $100,000 in total overhead by the clinic, and the department director has allocated $50,000 of this amount to the three services listed above. What is the fee schedule assuming that these overhead costs must be covered? (To answer this question, assume that the allocation of overhead costs to each service is made on the basis of number of visits.) Assume that these services must make a combined profit of $25,000. Now, what is the…

Gateway Tours is choosing between two bus​ models, one of which lasts longer than the other. ​ Gateway’s discount rate is​ 8%. It plans to continue with one of the two models for the foreseeable future. Based on the costs of each shown​ below, which should it​ choose? For each of the two bus​ models, give the relevant cost that you would use for comparison purposes. ​[Note: to make it easier for you to solve this​ problem, I have already calculated the EAA for one of the​ buses, as you can see. You do not need to recalculate that​ one.]   Model Year 0 Year 1 Year 2 Year 3 Year 4 Old Reliable 0 ​ -15 ​ -15 ​ -15 ​ -15 Short and Sweet ​ -12 ​ -12 ​ -6   The relevant cost for Old Reliable​ is:     A. ​-15.00   B. ​-49.68   C. ​-14.99   D. ​-15.01   E. ​-12.44   F. ​-15.10   G. ​-12.42   The relevant cost for Short and Sweet​ is:     A. ​-15.70   B. ​-28.26   C. ​-15.87   D. ​-9.12   E. ​-15.84   F. ​-8.53   G.…

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How would I do this problem?

Use CVP and compute the rooms sales to achieve breakeven for a single-product motel with total fixed costs of $40,000, an average room rate of $80, and a variable cost per room of $30. Prove the accuracy of your answer.