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Question 5 3 pts Darien Industries operates a cafeteria for its employees. The operation of the cafeteria requires fixed costs of $4,700 per month and variable costs of 40 percent of sales. The average cafeteria sales are currently $12,000 per month. Darien has an opportunity to replace the cafeteria with vending machines. Gross customer spending at vending machines is estimated to be 40 percent greater than current sales because the machines are available at all hours. By replacing the cafeteria with vending machines, Darien would avoid all cafeteria costs but receive 16 percent of the gross customer spending. How much does monthly operating income change if Darlen Industries replaces the cafeteria with vending machines? O A decease in profit $188 O An increase in profit $4,800 A decrease in profit $4,512 An increase in profit $188 Question 6 3 pts The executive education (EE) unit at the Business School of Central State University offers both open-enrollment (anyone can sign up) and custom (designed for a specific client) executive education programs. CSU has just received an inquiry from a prospective client about its prices for leadership seminars. The prospective client asks about prices for three alternative activity levels: (1) one seminar with 20 participants (2) four seminars with 20 participants each (80 participants total), or (3) eight seminars with 140 participants in total. EE's cost analyst has provided the following differential cost estimates. S 900 Setup costs for the entire job Materials costs per participant (brochures, handouts, coffee, lunch, etc.) Differential Direct Labor Costs: 150 One seminar $1,800 7 800 Four Seminars Eight seminars 13,200 In addition to the preceding differential costs, EE allocates fixed costs to jobs on a direct-labor-cost basis, at a rate of 75 percent of direct labor costs (excluding setup costs). EE charges clients for its full costs plus 20 percent. EE has enough excess capacity to handle this yob with ease. For the purpose of charging customers, costs equal the setup costs plus materials costs plus differential labor costs plus allocated fixed costs. What is the price that EE would charge for a participant of the leadership program based on four seminars? $423 $310.5 O 5398.25 $385.71