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Kent Company manufactures a product that sells for $50.00. Fixed costs are $260,000 and variable...

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Accounting

Kent Company manufactures a product that sells for $50.00. Fixed costs are $260,000 and variable costs are $24.00 per unit. Kent can buy a new production machine that will increase fixed costs by $11,400 per year, but will decrease variable costs by $3.50 per unit. What effect would the purchase of the new machine have on Kent's break-even point in units?

4,444 unit decrease.

5,714 unit increase.

No effect on the break-even point in units.

800 unit decrease.

800 unit increase.

Wang Company manufactures and sells a single product that sells for $450 per unit; variable costs are $270 per unit. Annual fixed costs are $801,000. Current sales volume is $4,200,000. Compute the current margin of safety in dollars.

$2,000,000.

$2,197,500.

$2,460,000.

$1,560,000.

$2,895,652.

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