mat 540

1* The Retread Tire Company recaps tires. The fixed annual cost of the recapping opration is $60,000
The variable cost of recapping a tire is $9.
The company charges $25 to recap a tire.
a. For an annual volume of 12,000 tires, determine the total cost, total revenue, and profit.
b. Determine the annual break-even volume for the Retead Tire Company operation.
2* If the Retread Tire Company in the above problem changes its pricing for recapping a tire from $25 to $31, what effect will the change have on the break-even volume?

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