wa waste disposal company is considering getting into bio-disposal business. the incinerators cost $5000 per unit....

wa waste disposal company is considering getting into bio-disposal business. the incinerators cost $5000 per unit. each unit can safely burn 1.25 tons of waste per burn and can be used for 6 burns per 8-hour day. each unit requires 1 worker to operate the unit. assume a labor rate of $11.05 per hour. in addition, each burn requires $62 of fuel to operate. the overhead is estimated to run $70.00 per day. the company estimates it has sufficient demand to operate 6 units of the incinerators. each ton of waste incinerated generates $87.00 of revenue. (round all intermediate calculations to 2 decimal places).

What is the Contribution margin to the fixed cost generated per day?

How many days will it take for the company to start making a profit from the incinerators?

If the company wishes to make profit after 40 days, what should be the price per ton?

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Expert Solution

Rahul Sunny answered 1 year ago

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