A television company is looking to develop and sell a new type of lower-end LED television screen. The cost of research and machinery requíred to begin production for the new model is $250,000. Each television would cost $125 to manufacture and would sell at $325. a. Use the graphical method to find the break-even point. Be sure to include the equations you graph and to label the intersection. b. Set up and use a color-coded spreadsheet to find the break-even point. c. After doing some research, the company has found an outside manufacturer willing to make the televisions at a price of $215 each. Use an Excel spreadsheet to calculate how many televisions the company would have to sell in order for in- house manufacturing to be worth the cost.
A television company is looking to develop and sell a new type of lower-end LED television screen. The cost of research and machinery requíred to begin production for the new model is $250,000. Each television would cost $125 to manufacture and would sell at $325. a. Use the graphical method to find the break-even point. Be sure to include the equations you graph and to label the intersection. b. Set up and use a color-coded spreadsheet to find the break-even point. c. After doing some research, the company has found an outside manufacturer willing to make the televisions at a price of $215 each. Use an Excel spreadsheet to calculate how many televisions the company would have to sell in order for in- house manufacturing to be worth the cost.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A television company is looking to develop and sell a new type of lower-end LED
television screen. The cost of research and machinery requíred to begin
production for the new model is $250,000. Each television would cost $125 to
manufacture and would sell at $325.
a. Use the graphical method to find the break-even point. Be sure to include the
equations you graph and to label the intersection.
b. Set up and use a color-coded spreadsheet to find the break-even point.
c. After doing some research, the company has found an outside manufacturer
willing to make the televisions at a price of $215 each. Use an Excel spreadsheet
to calculate how many televisions the company would have to sell in order for in-
house manufacturing to be worth the cost.
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