A Company Is Looking into Two Alternative Methods of Producing

question 139

Essay

A company is looking into two alternative methods of producing its product.The following information about the two alternatives is available:
$\begin{array}{lcc}& \underline {\text { Alternative \#1 } }& \underline {\text { Alternative \#2 } } \\\text { Variable costs per unit } & \$ 8 & \$ 12 \\\text { Fixed costs } & \$ 240,000 & \$ 140,000 \\\text { Sellingprice per unit } & \$ 20 & \$ 20\end{array}$ If the company's expected sales volume is 35,000 units, which alternative should be selected?

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Definitions:

Triumph

The state of being victorious or successful, often after a struggle or competition.

Mood

A temporary state of mind or feeling that influences an individual's emotional state and perceptions.

Emotion

A complex psychological state involving feelings, physiological changes, and an external expression, often triggered by a thought or experience.

James-Lange Theory

A theory of emotion that suggests emotions arise from physiological reactions to external events before they are mentally processed.