ABC Corporation would like to evaluate three production processes (A,B,and C)to accommodate the changes in demand for its products.The fixed and variable cost per unit are tabled here.Determine the production volume at which costs of Processes B and C are equal. $$\begin{array} { | l | l | l | }
\hline \text { Process } & \begin{array} { l }
\text { Fxed } \
\text { Cost }
\end{array} & \begin{array} { l }
\text { Variable Cost per } \
\text { Unit }
\end{array} \
\hline \mathrm { A } & \$ 30,000 & \$ 40 \
\hline \mathrm { B } & \$ 40,000 & \$ 30 \
\hline \mathrm { C } & \$ 80,000 & \$ 20 \
\hline
\end{array}$$

Question

ABC Corporation would like to evaluate three production processes (A,B,and C)to accommodate the changes in demand for its products.The fixed and variable cost per unit are tabled here.Determine the production volume at which costs of Processes B and C are equal. $$\begin{array} { | l | l | l | } 
\hline \text { Process } & \begin{array} { l } 
\text { Fxed } \
\text { Cost }
\end{array} & \begin{array} { l } 
\text { Variable Cost per } \
\text { Unit }
\end{array} \
\hline \mathrm { A } & \$ 30,000 & \$ 40 \
\hline \mathrm { B } & \$ 40,000 & \$ 30 \
\hline \mathrm { C } & \$ 80,000 & \$ 20 \
\hline
\end{array}$$

Quizplus · Accepted Answer

Let x be the production volume at which the costs of Processes B and C are equal.

For Process B:

Total cost = Fixed cost + Variable cost 
Total cost = $40,000 + $30x

For Process C:

Total cost = Fixed cost + Variable cost 
Total cost = $80,000 + $20x

To find the production volume at which both costs are equal, we set the total costs equal to each other:

$40,000 + $30x = $80,000 + $20x

Simplifying:

$10x = $40,000

x = 4,000

Therefore, the production volume at which the costs of Processes B and C are equal is 4,000 units.

ABC Corporation Would Like to Evaluate Three Production Processes (A,B,and