Cheong Automobile Company fabricates automobiles. Each vehicle includes one water pump, which is currently made in-house Details of the water pump assembly are as follows: Volume Variable cost per unit Fixed costs 1,400 units per month $11.50 per unit $10,000 per month An Indonesian factory has offered to supply Cheong Automobile Company with ready-made units for a cost of $16.00 for each water pump. Assume that Cheongs fixed costs are unavoidable and that Cheong will not be able to use the excess capacity in any profitable manner. If Cheong decides to outsource, monthly operating income will O A. increase by $10,000 B. decrease by $6,300 OC. decrease by $10,000 D. increase by $6,300 Bradley Industries is considering replacing a machine that is presently used in its production process. Which of the following is irrelevant to the replacement decision? Replacement Machine $46,000 5 Original cost Remaining useful life in years Current age in years Book value Current disposal value in cash Future disposal value in cash (in 5 years) Annual cash operating costs Old Machine $55,000 5 5 $30,000 $10,000 $0 $7,000 0 $0 $4,500 Which of the information provided in the table is irrelevant to the replacement decision? O A. the original cost of the old machine OB. the annual cash operating costs for both machines OC. the sales price of the new machine OD. the current disposal value of the old machine