A manufacturing company had the following fixed and variable costs over a 1-year period on a particular production line

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A Manufacturing Company Had The Following Fixed And Variable Costs Over A 1 Year Period On A Particular Production Line 1 (88.25 KiB) Viewed 15 times

A manufacturing company had the following fixed and variable costs over a 1-year period on a particular production line manufacturing radial drilling machines: Fixed Costs: Administrative costs Salaries and benefits: 25% of Equipment costs Space, utilities, etc. Computers: 1/5 of $ 90,000 $ 1,200,000 $ 300,000 $ 180,000 $ 750,000 Variable Costs S/Unit: Materials Labor Indirect labor Subcontractors A A A A $ $ $ $ 9,000 1,000 6,000 2,500 a) Determine the minimum revenue per unit to break even at the current production volume of 8,000 units per year. b) The company decided to sell the radial drilling machines internationally and to large manufacturing industries. It is estimated that the production level need to be increased to 12,500 units per year. Determine the revenue per unit required if a profit goal of 1.5 million is set for the entire production line. Assume the cost estimates above remain the same.