6. Assume that Cane normally produces and sells 101,000 Betas per year. If Cane discontinues the Beta product line, how much will profits increase or decrease?

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9. Assume that Cane expects to produce and sell 91,000 Alphas during the current year. A supplier has offered to manufacture and deliver 91,000 Alphas to Cane for a price of $124 per unit. If Cane buys 91,000 units from the supplier instead of making those units, how much will profits increase or decrease?

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Required information [The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $175 and $135, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 117,000 units of each product. Its unit costs for each product at this level of activity are given below: Direct materials Direct labour Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Cost per unit Alpha $ 40 30 18 26 23 26 $163 Beta $ 15 30 16 29 19 21 $130 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars