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16 Required information [The following information applies to the questions displayed below) Cane Company manufactures two products called Alpha and Beta that sell for $190
16 Required information [The following information applies to the questions displayed below) Cane Company manufactures two products called Alpha and Beta that sell for $190 and $155. respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 122,000 units of each product. Its average cost per unit for each product at this level of activity are given below. 3 points 8 004721 Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 40 34 21 29 26 29 $ 179 Beta $ 24 28 19 32 22 24 $ 149 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars Wilt uelease Alpha sales to regular customers by 11,000 units. a. What is the financial advantage (disadvantage) of accepting the new customer's order? b. Based on your calculations above should the special order be accepted? Complete this question by entering your answers in the tabs below. 5. Assume that Cane expects to produce and sell 109,000 Alphas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 24,000 additional Alphas for a price of $136 per unit; however pursuing this opportunity will decrease Alpha sales to regular customers by 11,000 units. a. What is the financial advantage (disadvantage) of accepting the new customer's order? b. Based on your calculations above should the special order be accepted
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