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Dear Tutor,
Could you please make clear the question 1 in June 2013 F9 Paper Exam, regarding with the calculation of sales income.
It says:
“This investment will increase production capacity by 9,000 units per year and all of these units are expected to be sold as they are produced”
So, I expected to see in the correction 9,000 units, 18,000 units, 27,000 units and 36,000 units for the year 1, 2,3 and 4, respectively. But the quantity units are constant throughout the project life.
Thanks in advance for your attention
Just suppose I am currently producing 100,000 units a year.
I am thinking of buying a better machine that will increase the production by 10,000 units a year.
What that means is that if I do buy the better machine, I will be able to produce 110,000 units a year.
(It would be an amazing machine if it was going to mean I could produce 110000, then 120000, then 130000 etc.. Surely it would be impossible to find a machine that would do something like that 🙂 )
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