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Answer the following questions. 1. Deibler Computers makes 5,800 units of a circuit board, CB76 at a cost of $290 each. Variable cost per unit
Answer the following questions. 1. Deibler Computers makes 5,800 units of a circuit board, CB76 at a cost of $290 each. Variable cost per unit is $210 and fixed cost per unit is $80. Peach Electronics offers to supply 5,800 units of CB76 for $270. If Deibler buys from Peach it will be able to save $15 per unit in fixed costs but continue to incur the remaining $65 per unit. Should Deibler accept Peach's offer? Explain. 2. RT Manufacturing is deciding whether to keep or replace an old machine. It obtains the following information: (Click the icon to view the information.) RT Manufacturing uses straight-line depreciation. Ignore the time value of money and income taxes. Should RT Manufacturing replace the old machine? Explain. 2. RT Manufacturing is deciding whether to keep or replace an old machine. RT Manufacturing uses straight-line depreciation. Ignore the time value of money and income taxes. Should RT Manufacturing replace the old machine? Explain. Begin by calculating the total relevant costs. (If an input field is not used in the table, leave the input field empty; do not enter a zero. Use parentheses or a minus sign for numbers to be subtracted.) Keep Replace Difference Cash operating costs Current disposal value of old machine Cost of new machine Total relevant costs Data Table Old Machine New Machine 10 years 4 years 4 years Original cost $ 10,700 $ 8,000 Useful life Current age 6 years O years Remaining useful life 4 years Accumulated depreciation $ 6,420 Not acquired yet Book value 4,280 Not acquired yet Current disposal value (in cash) $ 2,700 Not acquired yet Terminal disposal value (4 years from now) $ 0 $ 0 Annual cash operating costs $ 18,500 $ 16,500 Print Done
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