Class Exercise 2 Viti Industries needs to choose a production method for its new product The...

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Class Exercise 2 Viti Industries needs to choose a production method for its new product The firm has gathered the Tollowing production cost data and the price forecast: Variable cost per unit ($) Annualized Fixed Cost of plant and equipment ($) Process Price per unit ($) Туре Labour Material Energy A 1,150,000 70 25 18 12 900,000 72 28 20 14 C 1,750,000 60 15 17 11 On the same chart (on graph paper) plot the profit line for each option. Label each axis. Use 18 cm for x a) axis (Max X) and 24 cm td y axis (12 cm for positive side and 12 om for negative side). Compute the scales for each axis (cm). Show clearly all calculations and describe all relevant points on the graph. Show and detail the breakeven point for each process. Show and label all crossover points. Perform an analysis of the volume over which each process IS superior based on profit Write the range. Perform the consistency check. If expected volume is 100,000 units, which process would you recommend? Show all calculations that b) you use to reach a conclusion If expected volume is 60,000 units, which process would you recommend? Show all calculations that you use to reach a conclusion. (P If expected volume is 360,000 units, which process would you recommend? Show all calculations that you use to reach a conclusion. P7-2 Class Exercise 2 Viti Industries needs to choose a production method for its new product The firm has gathered the Tollowing production cost data and the price forecast: Variable cost per unit ($) Annualized Fixed Cost of plant and equipment ($) Process Price per unit ($) Туре Labour Material Energy A 1,150,000 70 25 18 12 900,000 72 28 20 14 C 1,750,000 60 15 17 11 On the same chart (on graph paper) plot the profit line for each option. Label each axis. Use 18 cm for x a) axis (Max X) and 24 cm td y axis (12 cm for positive side and 12 om for negative side). Compute the scales for each axis (cm). Show clearly all calculations and describe all relevant points on the graph. Show and detail the breakeven point for each process. Show and label all crossover points. Perform an analysis of the volume over which each process IS superior based on profit Write the range. Perform the consistency check. If expected volume is 100,000 units, which process would you recommend? Show all calculations that b) you use to reach a conclusion If expected volume is 60,000 units, which process would you recommend? Show all calculations that you use to reach a conclusion. (P If expected volume is 360,000 units, which process would you recommend? Show all calculations that you use to reach a conclusion. P7-2

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Answer a Graph Data ProcessA ProcessB ProcessC No of ProcessA ProcessB ProcessC Units P... View the full answer