1. Entity A is considering scrapping a machine with a useful life of 5 years and replacing it with a more efficient machine. Since the old machine has no market value, it cannot be sold after scrapping. It has been determined that the new machine, which can be used for 5 years, will cause a decrease of 25.000TL in annual fixed costs, reducing the total fixed cost to 160.000TL. 
2. It is estimated that the unit variable cost will increase from 8TL to 10TL if the new machine is purchased. 
3. The company's sales volume, which is currently 40,000 units, is not expected to change in the next five years.
4. The unit sales price of the product is 14 TL. In the case of using old and new machines; 
5. 
   
6. Calculate profit, profit margin, contribution margin, contribution rate, breakeven sales amount, and the amount and evaluate the appropriateness of the purchase decision.

Answer rating: 100% (QA)

Profit Total Revenue Total Cost Total Revenue Unit Sales Price x Sales Volume 14TL x 40... View the full answer