Extreme Sports Inc. is considering dropping their mountain bike segment. Information related to their mountain bike segment is as follows: Sales: Variable Expenses: Fixed Expenses: General factory overhead: Salary of segment manager: $336,000 $215,000 $100,000 $65,000 If the segment is dropped, the general factory overhead would be reallocated to other segments. Using incremental analysis, what is the impact on net income if management were to drop the mountain bike segment? Net income would decrease by $44,000 Net income would increase by $56,000 Net income would increase by $44,000 Net income would decrease by $56,000 Question 28 4.1 pts Which of the following is false regarding incremental analysis? Opportunity costs are typically irrelevant. Management should not consider costs and benefits that do not differ between alternatives in their decision-making process. Costs that are relevant in one decision situation may be irrelevant in another situation. Differential costs are relevant in the decision-making process. Costs that are always irrelevant are: Differential costs Direct materials Fixed costs Sunk costs Question 31 4.1 pts MC&A Corp. had the following costs during the period: Direct materials: $4,500 Direct labor: $5,600 Manufacturing Overhead: $3,700 Marketing costs: $2,200 Shipping costs: $1,500 Sales Salaries: $6,000 Office Salaries: $3,000 What amount would be reported as period costs and where? $12,700 would be reported in inventory on the balance sheet. $12,700 would be immediately expensed on the income statement. $7,500 would be reported in inventory on the balance sheet. $16,400 would be immediately expensed on the income statement. $16,400 would be reported in inventory on the balance sheet