M 1951 D Thu 12:15 AM Rashida Abdulmanaf a iE Exercises Chapter 13.doc (Compatibility Model e Layout Document Elements s New Roman 12 Aa Text Box Exercise Following a strategy of product differentiation, Sting Corporation makes a high-end computer monitor, CM7. Sting Corporation presents the following data for the years 2012 and 2013: 2012 2013 Units of CM7 produced and sold Selling price $440 Direct materials (pounds) 15,000 15,375 Direct materials costs per pound Manufacturing capacity for CM12 (units) 10,000 10,000 Conversion costs SI 000,000 SI 100,000 Conversion costs per unit of capacity SI00 SI10 58 Selling and customer-service capacity (customers) Total selling and customer-service costs S360,000 S362,500 Selling and customer service capacity cost per customer S6.000 S6.250 Sting Corporation produces no defective units but it wants to reduce direct materials usage per unit of CM7 in 2012. Manufacturing conversion costs in each year depend on production capacity defined in terms of CM7 units that can be produced. Selling and customer-servee costs depend on the number of customers that the customer and service functions are designed to support. Emsting Corporation has 100 customers in 2012 and 115 customers in 2013. The industry market size for high-end computer monitors increased 5% from 2012 to 2013. Print Layout View