(Solved): 2. An accounting firm is going to buy a new computerized system to support its accounting reporting ...

2. An accounting firm is going to buy a new computerized system to support its accounting reporting processes. Three potential systems are being evaluated. The results of the cost of each system for the processes are shown in the following table. (3 marks) Dollars required to process each accounting report S60 System A System B System C Purchasing cost $200,000 $300,000 $400,000 S25 $10 a) The accounting firm has currently made the decision of buying System A because the purchasing cost is the lowest. But, you notice that when the volume of accounting reports jumps to certain level, the overall cost of using System A will not be the lowest. What is that volume? b) In fact, the firm is going to have an aggressive expansion. Please advise the firm at what volume that System C will consume the minimum cost (i.e. the purchasing cost and the cost to process the reports).