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34 Boise, a division of Price Enterprises, currently performs computer services for various departments of the firm. One of the services has created a number

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34 Boise, a division of Price Enterprises, currently performs computer services for various departments of the firm. One of the services has created a number of operating problems, and management is exploring whether to outsource the service to a consultant. Traceable variable and fixed operating costs total $103,000 and $48,000, respectively, in addition to $41,000 of corporate administrative overhead allocated from Price Bolse were to use the outside consultant, fixed operating costs would be reduced by 70%. The Irrelevant costs in Bolse's outsourcing decision totat: Skope Multiple Choice O $33,600 $41,000 $48.000 $55,400 Nane n the answer The Boot Department at the Omaha Department Store is being considered for closure. The following information relates to boot activity, 35 $350,000 sales revenue Variable costat Cont of goods sold Sales commissions Pixed operating costs Sed 270,000 34,000 96,000 PE | 80% of the fixed operating costs are avoidable, should the Boot Department be closed? Multiple Choice Yes, Omahe would be better off by $30,800 Yes, Omaha would be better off by $50,000 No, Omaha would be worse off by $26.800 35 Multiple Choice Spoed Yes, Omaha would be better off by $30,800. Print O Yes. Omaha would be better off by $50,000 No, Omahe would be worse off by $26,800, No, Omaha would be worse off by $46,000. O None of the answers is correct San Ruiz Interiors provides design services to residential and commercial clients. The residential services produce a contribution margin of $560,000 and have traceable fixed operating costs of $570,000. Management is studying whether to drop the residential operation. If closed, the fixed operating costs will fall by $500,000 and San Rulz' Income will: Multiple Choice increase by $10,000 Increase by $60,000 increase by $490,000 decrease by $60,000 decrease by $490,000

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