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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)

Project Management, Management Studies

  • Category:- Project Management
  • Reference No.:- M915135

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