Question: The cost management team is analyzing two alternative production processes for a new product that will sell for $120 per unit. The marketing team is

The cost management team is analyzing two alternative production processes for a new product that will sell for $120 per unit. The marketing team is projecting that 10,000 units will sell annually. The two production processes have different cost structures as shown below. Process A: $55 per unit variable cost; Annual fixed costs $200,000 Process B: $50 per unit variable cost; Annual fixed costs $325,000 The executive team has set a target income of $400,000 for this new product. Based on an analysis of costs, sales volume, and profit for each process, what course of action should the cost management team recommend?

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