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Markson Company had the following results of operations for the past year: $ 166,400 Sales (8,000 units at $20.80) Variable manufacturing costs Fixed manufacturing costs

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Markson Company had the following results of operations for the past year: $ 166,400 Sales (8,000 units at $20.80) Variable manufacturing costs Fixed manufacturing costs Variable selling and administrative expenses Fixed selling and administrative expenses Operating income $ 89,200 15,800 15,200 20,800 (141,000) 25, 400 $ A foreign company whose sales will not affect Markson's market offers to buy 2,000 units at $15.20 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $1,680 for the purchase of special tools. Markson's annual productive capacity is 12,000 units. If Markson accepts this additional business, its profits will: Multiple Choice Increase by $4,300 Decrease by $1,680. Decrease by $5,980. Decrease by $4,850. Maxim manufactures a hamster food product called Green Health. Maxim currently has 10,000 bags of Green Health on hand. The variable production costs per bag are $2.20 and total fixed costs are $10,000. The hamster food can be sold as it is for $9.45 per bag or be processed further into Premium Green and Green Deluxe at an additional $2,400 cost. The additional processing will yield 10,000 bags of Premium Green and 3,400 bags of Green Deluxe, which can be sold for $8.45 and $6.45 per bag, respectively. The net advantage (incremental income) of processing Green Health further into Premium Green and Green Deluxe would be: Multiple Choice $106,430. 0 $104,030 $11,930. $9,530. $2,400

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