increases the unit variable cost by $18 per unit but it does not have any fixed costs. The company sells the product for $134 per unit. Assume that the facility can be used for manufacturing up to 7 hours per day. What is the yearly operating income if the yearly demand for the product is: [a] 72,000 units? [b] 55,000 units? [c] 88,000 units?
increases the unit variable cost by $18 per unit but it does not have any fixed costs. The company sells the product for $134 per unit. Assume that the facility can be used for manufacturing up to 7 hours per day. What is the yearly operating income if the yearly demand for the product is: [a] 72,000 units? [b] 55,000 units? [c] 88,000 units?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![I need the yearly operating income if the yearly demand was a,b,
or c.
A company produces a product in its manufacturing facility.
Each unit of product requires 1.60 minutes of manufacturing time.
The facility operates 230 regular operating days per year plus
90 overtime operating days per year.
Under regular operating days, the unit variable cost is $49 and the
yearly fixed cost is $2,110,000. An overtime operating day
increases the unit variable cost by $18 per unit but it does not
have any fixed costs. The company sells the product for $134 per unit.
Assume that the facility can be used for manufacturing up to 7 hours
per day. What is the yearly operating income if the yearly demand for
the product is:
[a] 72,000 units?
[b] 55,000 units?
[c] 88,000 units?
hmit a hrinf ronort tueina](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F41cad378-5875-4c92-837f-f5fcc3a48de0%2Ff991b952-17f1-43ff-8f0a-436d9ae73d4f%2Fq5xjook_processed.jpeg&w=3840&q=75)
Transcribed Image Text:I need the yearly operating income if the yearly demand was a,b,
or c.
A company produces a product in its manufacturing facility.
Each unit of product requires 1.60 minutes of manufacturing time.
The facility operates 230 regular operating days per year plus
90 overtime operating days per year.
Under regular operating days, the unit variable cost is $49 and the
yearly fixed cost is $2,110,000. An overtime operating day
increases the unit variable cost by $18 per unit but it does not
have any fixed costs. The company sells the product for $134 per unit.
Assume that the facility can be used for manufacturing up to 7 hours
per day. What is the yearly operating income if the yearly demand for
the product is:
[a] 72,000 units?
[b] 55,000 units?
[c] 88,000 units?
hmit a hrinf ronort tueina
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