11&12

11. The forecast income statement for Stallworth, Inc. for next year is as follows: Product: R Total Sales Revenue $300,000 $210,000 S280,000 5790.000 Total costs $230,000 $230,000 $320,000 $780,000 Net Income (loss) S 70.000 S/20.000) (S40,000) $10.000 Management is considering ending the production and sale of Product Q and Product Rat the beginning of next year. Ending Products Q and R will have no effect on total fixed costs or on the sales of Product P. Product Q's fixed costs are 12% of its total costs, and Product R's fixed costs are 8% of its total costs. a) Calculate the estimated amount of change in Stallworth's net income for next year that will result from ending production and sale of Product Q. b) Calculate the estimated amount of change in Stallworth's net income for next year that will result from ending production and sale of Product R. 12. Stargell Inc. has the following data for production of 21,000 units of a subcomponent (part) of its finished product: direct materials, $408,200; direct labor 0.48 hours per unit at an average rate of $40 per hour; estimated variable factory overhead cost was $50 per direct labor hour. Total fixed and variable factory overhead costs incurred for production of the 21,000 units was $550,000. An outside supplier has offered to sell Stargell the subcomponent for $63.50 per unit. Stargell's cost accountant says that if this offer is accepted, fixed costs will not change. Calculate the amount of increase or decrease in Stargell's net income if it accepts the offer from the outside supplier(round to nearest $1)