Ashley’s company is looking to add two new printers that will increase fixed costs by $75,000. The variable costs are $50 per order. The two new printers allow the business to increase their orders by 5000 annually.How many orders would have to be added to justify buying these new printers, vs not making any changes and continuing as they are? What other considerations might you consider in whether or not to make this purchase or not?

An indifference point is a point on which the entity becomes indifferent between two options, and…

Answered: Ashley’s company is looking to add two…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 5PA: Kylies Cookies is considering the purchase of a larger oven that will cost $2,200 and will increase...

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Ashley’s company is looking to add two new printers that will increase fixed costs by $75,000. The variable costs are $50 per order. The two new printers allow the business to increase their orders by 5000 annually.

How many orders would have to be added to justify buying these new printers, vs not making any changes and continuing as they are?
What other considerations might you consider in whether or not to make this purchase or not?

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