How Do I Determine Which Cost Structure Is Best For A Company?

Information:
Cost Structure A has a variable expense of $89 per unit and fixed costs of $3.6 million.
Cost Structure B has a variable expense of $202 per unit and fixed costs of $1.7 million.
Obviously, structure A benefits from higher sales numbers to cover the high fixed.
Structure B, provides some security in that the costs are associated with sales (no sales, no incurred costs).
Here is my problem, I do not know how many units will sell. I do know that is will between 3,000 and 31,000 units.
Advice?

Both comments and pings are currently closed.

Comments are closed.

Powered by WordPress | Designed by: free css template | Thanks to hostgator coupon and web hosting reviews