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Can someone check my answers? On these three seperate problems {{{{Problem #1}}} --------------------------------------------------------------------------------------------------------------------------------------------------------------- {{{{Problem #2}}} --------------------------------------------------------------------------------------------------------------------------------------------------------------- {{{{Problem #3}}} Freeflight Airlines is presently operating at 70
Can someone check my answers? On these three seperate problems
{{{{Problem #1}}}
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{{{{Problem #2}}}
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{{{{Problem #3}}}
Freeflight Airlines is presently operating at 70 percent of capacity. Management of the airline is considering dropping Freeflight's routes between Europe and the United States. If these routes are dropped, the revenue associated with the routes would be lost and the related variable costs saved. In addition, the company's total fixed costs would be reduced by 20 percent. Segmented income statements for a typical month appear as follows (all amounts in millions of dollars): Required: a. Prepare a differential cost schedule. (Select option "increase" or "decrease", keeping Status Quo as the base. Select "none" if there is no effect. Enter your answers in millions rounded to 2 decimal places.) b. Should Freeflight drop the routes between Europe and the United States? Yes No Required information [The following information applies to the questions displayed below.] Mel's Meals 2 Go purchases cookies that it includes in the 10,000 box lunches it prepares and sells annually. Mel's kitchen and adjoining meeting room operate at 70 percent of capacity. Mel's purchases the cookies for $0.82 each but is considering making them instead. Mel's can bake each cookie for $0.30 for materials, $0.15 for direct labor, and $0.55 for overhead without increasing its capacity. The $0.55 for overhead includes an allocation of $0.35 per cookie for fixed overhead. However, total fixed overhead for the company would not increase if Mel's makes the cookies. Mel himself has come to you for advice. "It would cost me $1.00 to make the cookies, but only $0.82 to buy. Should I continue buying them?" Materials and labor are variable costs, but variable overhead would be only $0.20 per cookie. Two cookies are put into every lunch. Required: a. Prepare a schedule to show the differential costs per cookie. (Enter your answers to 2 decimal places. Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.) b. Should Mel continue to buy the cookies? Yes No Alpine Luggage has a capacity to produce 370,000 suitcases per year. The company is currently producing and selling 290,000 units per year at a selling price of $403 per case. The cost of producing and selling one case follows: The company has received a special order for 40,000 suitcases at a price of $248 per case. It will not have to pay any sales commission on the special order, so the variable selling and administrative costs would be only $51 per suitcase. The special order would have no effect on total fixed costs. The company has rejected the offer based on the following computations: Required: a. What is the impact on profit for the year if Alpine accepts the special order? (Enter your answers in thousands of dollars. Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.) b. Do you agree with the decision to reject the special order? Yes NoStep by Step Solution
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