46) 46) The opportunity cost of making a component part in a factory with excess capacity for which there is no alternative use is: A) the total manufacturing cost of the component. B) zero. C) the variable manufacturing cost of the component. D) the fixed manufacturing cost of the component. 47) Which of the following costs are always irrelevant in decision making? A) avoidable costs B) fixed costs C) sunk costs D) opportunity costs 48) Hodge Inc. has some material that originally cost $74,600. The material has a scrap value of $57,400 as is, but if reworked at a cost of $1,500, it could be sold for $54,400. What would be the financial advantage (disadvantage) of reworking and selling the material rather than selling it as is as scrap? A) $52,900 B) ($4,500) C) ($79,100) D) ($21,700) 49) 49) Otool Inc. is considering using stocks of an old raw material in a special project. The special project would require all 240 kilograms of the raw material that are in stock and that originally cost the company $2,112 in total. If the company were to buy new supplies of this raw material on the open market, it would cost $9.25 per kilogram. However, the company has no other use for this raw material and would sell it at the discounted price of $8.35 per kilogram if it were not used in the special project. The sale of the raw material would involve delivery to the purchaser at a total cost of $71 for all 240 kilograms. What is the relevant cost of the 240 kilograms of the raw material when deciding whether to proceed with the special project? A) $2,220 B) $2,112 C) $2,004 D) $1,933 50) 50) A study has been conducted to determine if one of the departments in Carry Corporation should be discontinued. The contribution margin in the department is $80,000 per year. Fixed expenses charged to the department are 595,000 per year. It is estimated that $50,000 of these fixed expenses could be eliminated if the department is discontinued. These data indicate that if the department is discontinued, the yearly financial advantage (disadvantage) for the company would be: A) $15.000 B) ($15,000) C) ($30,000) D) $30,000