The following table shows the critical factors in a company’s decision on choosing a new piece of equipment. Calculate the breakeven volume and utilization for each option and then find the range of volumes for which each option is the best decision.
Machine A
Machine B
Machine C
Fixed Costs/Month
$ 6,000.00
$ 17,000.00
$ 10,000.00
Variable Cost/Unit
$ 87.00
$ 51.00
$ 68.00
Revenue/Unit
$ 250.00
$ 250.00
$ 250.00
Capacity/Month
100
500
200
Breakeven Volume
Breakeven Utilization
Best Option Volume Range
min
max
