Suppose that you are the manager of a studio cafe, and you are planning to invest on a new camera and a coffee maker designed to increase the productivity of your employees and output (services) produced. Your analyst provided you the following information: Complete the table below. Current Situation Projected Sales and Profit Incremental Revenues and Costs Total Revenue Php1,500,000 Php1,800,000 Variable Cost 575,000 425,000 Direct Fixed Costs 625,000 700,000 Indirect Fixed Costs 100,000 100,000 Profit Should the new camera and coffee maker be purchased? Explain your answer based on the incremental analysis.
Suppose that you are the manager of a studio cafe, and you are planning to invest on a new camera and a coffee maker designed to increase the productivity of your employees and output (services) produced. Your analyst provided you the following information: Complete the table below. Current Situation Projected Sales and Profit Incremental Revenues and Costs Total Revenue Php1,500,000 Php1,800,000 Variable Cost 575,000 425,000 Direct Fixed Costs 625,000 700,000 Indirect Fixed Costs 100,000 100,000 Profit Should the new camera and coffee maker be purchased? Explain your answer based on the incremental analysis.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter7: Proudction Costs
Section: Chapter Questions
Problem 6SQ
Related questions
Question
Suppose that you are the manager of a studio cafe, and you are planning to invest on a new camera and a coffee maker designed to increase the productivity of your employees and output (services) produced. Your analyst provided you the following information:
- Complete the table below.
|
Current Situation |
Projected Sales and Profit |
Incremental Revenues and Costs |
Total Revenue |
Php1,500,000 |
Php1,800,000 |
|
|
|
|
|
Variable Cost |
575,000 |
425,000 |
|
Direct Fixed Costs |
625,000 |
700,000 |
|
Indirect Fixed Costs |
100,000 |
100,000 |
|
|
|
|
|
Profit |
|
|
|
- Should the new camera and coffee maker be purchased? Explain your answer based on the incremental analysis.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning