Syntech makes digital cameras for drones. Their basic digital camera uses $80 in variable costs and requires $1,400 5 per month. If they process the camera further to enhance its functionality, it will require an additional $45 per unit of variable costs, plus an increase in fixed costs of $900 per month. The current price of the camera is $170. The marketing manager is positive that they can sell more and charge a higher price for the improved version. At what price level would the upgraded camera begin to improve operational earnings? Price to be charged

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter10: Short-term Decision Making
Section: Chapter Questions
Problem 2PA: Syntech makes digital cameras for drones. Their basic digital camera uses $80 in variable costs and...
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Syntech makes digital cameras for drones. Their basic digital camera uses $80 in variable costs and requires $1,400 per month in fixed costs. Syntech sells 100 cameras
per month. If they process the camera further to enhance its functionality, it will require an additional $45 per unit of variable costs, plus an increase in fixed costs of
$900 per month. The current price of the camera is $170. The marketing manager is positive that they can sell more and charge a higher price for the improved version.
At what price level would the upgraded camera begin to improve operational earnings?
Price to be charged
Feedback
Transcribed Image Text:Syntech makes digital cameras for drones. Their basic digital camera uses $80 in variable costs and requires $1,400 per month in fixed costs. Syntech sells 100 cameras per month. If they process the camera further to enhance its functionality, it will require an additional $45 per unit of variable costs, plus an increase in fixed costs of $900 per month. The current price of the camera is $170. The marketing manager is positive that they can sell more and charge a higher price for the improved version. At what price level would the upgraded camera begin to improve operational earnings? Price to be charged Feedback
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