22. Clemente could avoid $3,000 of fixed overhead by accepting the offer, net income would increase (decrease) by a. $750. b. $(5,850). c. $(3,150). d. $6,750 23. f Clemente accepts the offer, it could use the production capacity to produce another product that would generate additional income of $3,600. The increase (decrease) in net income from accepting the offer would be a. $150. b. $7,350 c. $(150) d. $(3,600). 24.Crigui Music produces 60,000 CDs on which to record music. The CDs have the following costs: Direct Materials $13,000 15,000 3,000 7,000 Direct Labor Variable Overhead Fixed Overhead Crigui could avoid $4,000 in fixed overhead costs if it acquires the CDs externally. If cost minimization is the major consideration and the company would prefer to buy the 60,000 units externally, what is the maximum external price that Crigui would expect to pay for the units? a. $34,000 b. $31,000 c. $38,000 d. $35,000 25. Crigui Music produces 60,000 CDs on which to record music. The CDs have the following costs: $13,000 15,000 3,000 7,000 Direct Materials Direct Labor Variable Overhead Fixed Overhead None of Crigui's fixed overhead costs can be reduced, but another product could be made that would increase profit contribution by $4,000 if the CDs were acquired externally. If cost minimization is the major consideration and the company would prefer to buy the CDs, what is the maximum external price that Crigui would be willing to accept to acquire the 60,000 units externally? a. $38,000 b. $34,000 c. $35,000 d. $42,000 22. Clemente could avoid $3,000 of fixed overhead by accepting the offer, net income would increase (decrease) by a. $750. b. $(5,850). c. $(3,150). d. $6,750 23. f Clemente accepts the offer, it could use the production capacity to produce another product that would generate additional income of $3,600. The increase (decrease) in net income from accepting the offer would be a. $150. b. $7,350 c. $(150) d. $(3,600). 24.Crigui Music produces 60,000 CDs on which to record music. The CDs have the following costs: Direct Materials $13,000 15,000 3,000 7,000 Direct Labor Variable Overhead Fixed Overhead Crigui could avoid $4,000 in fixed overhead costs if it acquires the CDs externally. If cost minimization is the major consideration and the company would prefer to buy the 60,000 units externally, what is the maximum external price that Crigui would expect to pay for the units? a. $34,000 b. $31,000 c. $38,000 d. $35,000 25. Crigui Music produces 60,000 CDs on which to record music. The CDs have the following costs: $13,000 15,000 3,000 7,000 Direct Materials Direct Labor Variable Overhead Fixed Overhead None of Crigui's fixed overhead costs can be reduced, but another product could be made that would increase profit contribution by $4,000 if the CDs were acquired externally. If cost minimization is the major consideration and the company would prefer to buy the CDs, what is the maximum external price that Crigui would be willing to accept to acquire the 60,000 units externally? a. $38,000 b. $34,000 c. $35,000 d. $42,000
