7 8 6 fort ABC Requirements D 1 Davanit Computers makes circuit boards. Review the information below for circuit board CB76 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Number of units made Total cost per unit Variable cost per unit Fixed cost per unit 5,600 $200 $160 $40 Peach Electronics offers to supply the following for CB76 Units of CB76 Cost per unit If Davanit buys from Peach the following will occur: Savings in fixed cost per unit Remaining fixed cost per unit that Davanit will continue to incur 5,600 $180 $15 $25 Calculate the relevant cost per unit to continue making CB76 and the relevant cost per unit to purchase CB76. Should Davanit accept Peach's offer? 2 LF Manufacturing is deciding whether to keep or replace an old machine. It obtains the following information: Old Machine New Machine $10,900 25 26 27 28 29 30 Original cost Useful life Current age Remaining useful life $8,200 10 years 3 years 7 years 0 years 3 years 3 years 32 Accumulated depreciation $7,630 Not acquired yet 33 Book value $3,270 Not acquired yet 34 Current disposal value (in cash) $2,700 Not acquired yet 35 Terminal disposal value (5 years from no $0 $0 36 Annual cash operating costs $17,500 $14,500 37 38 39 LF Manufacturing uses straight-line depreciation. Ignore the time value of money and income taxes. Calculate the total relevant costs to keep or replace the old machine. Should LF Manufacturing replace the old machine? INSTRUCTIONS Ready Accessibility Investigate Type here to search ENTERANSWERS E B D E 1. Calculate the relevant cost per unit to continue making CB76 and the relevant 1 cost per unit to purchase CB76. Should Davanit accept Peach's offer? (Always use cell references and formulas where appropriate to receive full credit. If you 2 copy/paste from the Instructions tab you will be marked wrong.) 3 4 Relevant cost per unit to continue making CB76 5 Relevant cost per unit to purchase CB76 6 Should Robinson accept Peach's offer? 7 2. Calculate the total relevant costs to keep or replace the old machine. Should LF 8 Manufacturing replace the old machine? (Always use cell references and formulas where appropriate to receive full credit. If you 9 copy/paste from the Instructions tab you will be marked wrong.) 10 11 Total relevant costs to keep the old machine 12 Total relevant costs to replace the old machine 13 Should RT Manufacturing replace the old machine? 14 15 16 17 INSTRUCTIONS Ready Accessibility Investigate Type here to search ENTERANSWERS FO