Mueller Corp. manufactures flash drives that sell for $5.00.  Fixed costs are $28,000 and  variable costs are $3.60 per unit.  Mueller can buy a newer production machine that will  increase fixed costs by $8,000 per year, and will decrease variable costs by $0.40 per unit.    What effect would the purchase of the new machine have on Mueller's break-even point in  units?

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.