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John's 8-year-old Chevrolet Trail Blazer requires repairs estimated at $7,000 to make it road worthy again. His wife, Sherry, suggested that he should buy
John's 8-year-old Chevrolet Trail Blazer requires repairs estimated at $7,000 to make it road worthy again. His wife, Sherry, suggested that he should buy a 5-year-old used Jeep Grand Cherokee instead for $7,000 cash. Sherry estimated the following costs for the two cars: Trail Blazer Acquisition cost $30,000 Grand Cherokee $7,000 Repairs $7,000 Annual operating costs (Gas, maintenance, insurance) $2,580 $1,700 What should John do? What are his savings in the first year? OA. Buy the Grand Cherokee: $880 O B. Fix the Trail Blazer; $7,247 C. Fix the Trail Blazer; $4,380 D. Buy the Grand Cherokee: $8,700 W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production costs for 1,000 units are as follows: Direct materials Direct labor $42,000 10,500 Variable overhead costs 32,500 Fixed overhead costs Total costs 18,000 $103,000 It is estimated that 6% of the fixed overhead costs assigned to ACT31107 will no longer be incurred if the company purchases ACT31107 from the outside supplier. W.T. Ginsburg Engine Company has the option of purchasing the part from an outside supplier at $94.75 per unit. If W.T. Ginsburg Engine Company purchases 1,000 ACT31107 parts from the outside supplier per month, then its monthly operating income will any intermediary calculations and your final answer to the nearest cent.) 0000 O A. increase by $21,330 B. decrease by $8,670 C. decrease by $21,330 OD. increase by $8,670 (Round
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