Final answer:
To break even between upgrading the calculators and selling them in their present condition, the selling price per unit of the upgraded calculators should be $540.
Step-by-step explanation:
To determine the selling price per unit at which the company would break even between upgrading the calculators and selling them in their present condition, we need to compare the total costs and total revenues in both scenarios.
If the calculators are upgraded, the total cost would be the cost of upgrading ($210,000) plus the cost of inventory ($720,000), which is $930,000. The total revenue would be the selling price of the upgraded calculators ($270,000).
On the other hand, if the calculators are sold in their present condition, the total cost would be the cost of inventory ($720,000). The total revenue would be the selling price of the calculators in their present condition ($50,000).
Let's set up an equation to find the selling price per unit at which the company would break even:
(Selling price per unit) * (number of calculators) = Total revenue
For the upgraded calculators:
Selling price per unit * 500 = $270,000
Solving for selling price per unit:
Selling price per unit = $270,000 / 500 = $540
Therefore, the company would be as well off as if it just sold the calculators in their present condition if the selling price per unit of the upgraded calculators is $540.