If the firm selects to make modifications variable, Ask an Expert

Management Studies

Ski Boards, Inc., wants to enter market quickly with new finish on its ski boards. It has two alternatives:

A) Make major modifications at a fixed cost of $26,000, or

B) Purchase new equipment at a net fixed cost of $63,000.

If the firm selects to make modifications, variable materials and labour will be $27.0 for each board. If it purchases new equipment, variable costs are approximated to be $17.5 per board.

What is minimum sales quantity which would justify the purchase of the new equipment? (Identify as a whole number by rounding)

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Project Management, Management Studies

Category:- Project Management
Reference No.:- M915135

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