Given the PERT Chart above, your goal is to lower project completion time. If you can spend $500 and reduce activity I-J by one day or spend $600 and reduce activity C-F by two days; which, if either,...

Solution 9:
Fixed cost per month: $10000
Variable costs: $2.50 per product
Product income per sale: $7.50
Calculating the break even point = Fixed cost / (Sales price – Variable cost)
= 10000 / (7.50 – 2.50)
= 2000 units
Increase in variable cost by 20%
= 2.50*1.20
= $3
Calculating the break even point = Fixed cost / (Sales price – Variable cost)
= 10000 / (7.50 – 3)
= 2222.22 units
Solution 10:
Cost structure of an organization greatly depends on kind of organization as well as the industry
in which the particular organization operates.
While executing their daily responsibilities of managing the operations of an organization,
managers are faced with decisions that may affect only the next few days, weeks, or
months. These short-run decisions could involve the utilization of resources not otherwise active
or the opportunity to reduce costs by outsourcing the production of certain components that will
be used in production. Or a manager might have the ability to improve profits by choosing to sell
a product at a certain point in the production process or by choosing to refine the product further
and in doing so attract a higher selling price. Relevant costs are those future costs that represent
differences between these decision alternatives and they are the key to effective decision making.
Past transaction costs, while appropriately recorded in the accounting system as a result of the
financial accounting process, represent costs that are never relevant and can only confuse the
manager presented with the challenge of correctly analyzing costs in any decision whereas
Irrelevant cost is all the past marketing and...