=+EX 25-19 Target costing obj. 2 b. $16 Armstrong Alloys Inc. has three grades of metal
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=+EX 25-19 Target costing obj. 2
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b. $16 Armstrong Alloys Inc. has three grades of metal product, Type 5, Type 10, and Type 20.
Financial data for the three grades are as follows:
Type 5 Type 10 Type 20 Revenues $36,000 $40,000 $22,000 _______ _______ _______ Variable cost $22,500 $20,000 $15,000 Fixed cost 6,000 6,000 6,000 _______ _______ _______ Total cost $28,500 $26,000 $21,000 _______ _______ _______ Income from operations $ 7,500 $14,000 $ 1,000 Number of units ÷ 5,000 ÷ 5,000 ÷ 5,000 _______ _______ _______ Income from operations per unit $ 1.50 $ 2.80 $ 0.20 _______ _______ _______ _______ _______ _______ Armstrong’s operations require all three grades to be melted in a furnace before
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