chapter 10 Assignment (Due by 10 AM on May 31")-scan and submit on Canvas Problem 1: Identifying Relevant Costs Listed below are a number of different costs a manufacturing company has. Management of this company is trying to make decisions based on these two situations Situation 1: The company chronically has no idie capacity and the old is considering purchasing a Model B300 machine to use in addition to the company's present Model B100 old Model B100 machine will continue to be used to capacity as before, with the new Model B300 machine being expand production. This will increase the company's production and sales. The increase in volume will be large enough require increases in fixed selling expenses and in general administrative overhead, but not in the fixed manu Model B100 machine is the company's constraint. Management used to to overhead Situation 2 The old Model B100 machine is not the company's constraint, but management is considerning replacing it with a new Model B300 machine because of the potential savings in direct materials with the new machine. The Model B100 machine would be sold. This change will have no effect on production or sales, other than some savings in direct materials costs due to less waste. Required: Place an X in the appropriate column to indicate whether each item is relevant or not relevant the two situations Situation 1 Situation 2 RelevantNot Not Relevant Item Relevant Relevant a Sales revenue b. Direct materials C. Direct labor d. Variable manufacturing overhead e. Depreciation-Model B100 f Book value Model B100 9. Disposal value-Model B100 h Market value Model B300 machine machine machine machine (cost) Variable selling expense Fixed manufacturing overhead Fixed selling expense General administrative overhead