Lusk Corporation produces and sells 14,700 units of Product X each month. The selling price of Product X is $29 per unit, and variable expenses are $23 per unit. A study has been made concerning whether Product X should be discontinued. The study shows that $73,000 of the $102,000 in monthly fixed expenses charged to Product X would not be avoidable even if the product was discontinued. If Product X is discontinued, the monthly financial advantage (disadvantage) for the company of eliminating this product should be: Multiple Choice O ($59,200) O $13,800 O $42,800 O ($42,800)2 A study has been conducted to determine if Product A should be dropped. Sales of the product total $500,000; variable expenses total $340,000. Fixed expenses charged to the product total $210,000. The company estimates that $60,000 of these fixed expenses are not avoidable even if the product is dropped. If Product A is dropped, the annual financial advantage (disadvantage) for the company of eliminating this product should be: Multiple Choice ($10,000) O $10,000 O ($50,000) O $50,0003 An automated turning machine is the current constraint at Jordison Corporation. Three products use this constrained resource. Data concerning those products appear below: LN JQ RQ Selling price per unit $ 162. 13 $ 338 . 04 $ 412.56 Variable cost per unit $ 139.33 $ 252. 24 $ 348 .84 Minutes on the constraint 1. 50 6 .50 5 . 40 Rank the products in order of their current profitability from most profitable to least profitable. In other words, rank the products in the order in which they should be emphasized. (Round your intermediate calculations to 2 decimal places.) Multiple Choice O LN, JQ, RQ O RQ, LN, JQ O RQ, JQ, LN O JQ, RQ, LN4 The Wyeth Corporation produces three products, A, B, and C, from a single raw material input. Product A can be sold at the splitoff point for $40,000, or it can be processed further at a total cost of $15,000 and then sold for $58,000. Joint costs total $60,000 annually. Product A should be: Multiple Choice O discontinued because revenues after further processing are less than total joint costs. O sold at the split-off point. O processed further and then sold. O processed further only if its share of the total joint costs is less than the incremental revenues from further processing.5 Two alternatives, code-named X and Y, are under consideration at Guyer Corporation. Costs associated with the alternatives are listed below. Alternative X Alternative Y Materials costs $ 51, 000 $ 74, 000 Processing costs $ 56, 000 $ 56, 000 Equipment rental $ 21, 000 $ 21, 000 Occupancy costs $ 20, 000 $ 29, 800 What is the financial advantage (disadvantage) of Alternative Y over Alternative X? Multiple Choice O $(164,400) O $148,000 O $180,800 O $(32,800)The Tolar Corporation has: 400 obsolete desk calculators that are carried in inventory at a total cost of $26,800. If these calculators are upgraded at a total cost of $10.000, they can be sold for a total of $30000. As an alternative. the calculators can be sold in their present condition for $11,200. The sunk cost in this situation is: Mulllple Choice 0 $10,000 $26,800 $0 0 0 $11,200 0 The management ofWoznick Corporation has been concerned for some time with the financial performance of its product V860 and has consrdered discontinuing it on several occasions. Data from the company's accounting system for this product for last year appear below: sales as 158,888 Variable expenses $ 72,888 Fixed manufacturing expenses $ 58,888 Fixed selling and administrative expenses $ 33,888 In the company's accounting system all fixed expenses of the company are fully allocated to products. Further investigation has revealed that $30000 of the fixed manufacturing expenses and $13,000 ofthe fixed selling and administrative expenses are avoidable if product V860 l5 discontinued. What would be the financial advantage (disadvantage) from dropping product V860? Multiple Choice 0 ($35,000) ($5.000) $5,000 0 O $35000 O Direct labor $ 3. 10 Variable overhead $ 6. 90 8 Supervisor's salary $ 5.80 Depreciation of special equipment $ 5. 20 Allocated general overhead $ 5. 60 An outside supplier has offered to produce and sell the part to the company for $20.80 each. If this offer is accepted, the supervisor's salary and all of the variable costs, including direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company. If the outside supplier's offer were accepted, only $4,000 of these allocated general overhead costs would be avoided. If management decides to buy part Z43 from the outside supplier rather than to continue making the part, what would be the annual financial advantage (disadvantage)? Multiple Choice ($34,500) O ($30,500) O ($15,500) O ($38,500)9 The constraint at Pickrel Corporation is time on a particular machine. The company makes three products that use this machine. Data concerning those products appear below: VD JT SM Selling price per unit $ 344. 85 $ 415.40 $ 119.32 Variable cost per unit $ 270. 18 $ 310 . 88 $ 91.96 Minutes on the constraint 5 . 70 6. 70 1. 90 Rank the products in order of their current profitability from most profitable to least profitable. In other words, rank the products in the order in which they should be emphasized. (Round your intermediate calculations to 2 decimal places.) Multiple Choice O JT, SM, VD O JT, VD, SM O VD, SM, JT O SM, VD, JT