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More info Data table Boom Electronic's 4K 55 inch TV's have a quality problem that causes shadows in the picture. Its engineers suggest changing a

image text in transcribedimage text in transcribed More info Data table Boom Electronic's 4K 55 inch TV's have a quality problem that causes shadows in the picture. Its engineers suggest changing a key component in each TV. The new component will cost $24 more than the old one. In the next year, however, Boom Electronics expects that with the new component it will (1) save 9,700 hours of rework, (2) save 970 hours of customer support, (3) move 280 fewer loads, (4) save 10,200 hours of warranty repairs, and (5) sell an additional 2,1004KTVs, for a total contribution margin of $2,058,000. Boom Electronics believes that even as it improves quality, it will not be able to save any of the fixed costs of rework or repair. Boom Electronics uses a 1-year time horizon for this decision because it plans to introduce a $KTV at the end of the year. Requirements 1. Should Boom Electronics change to the new component? Show your calculations. 2. Suppose the estimate of 2,100 additional TVs sold is uncertain. What is the minimum number of additional printing presses that Boom Electronics needs to sell to justify adopting the new component? 3. What other factors should managers at Boom Electronics consider when making their decision about changing to a new component? Requirement 1. Should Boom Electronics change to the new component? Show your calculations. Relevant costs over the next year from changing to the new component equal Now calculate the cost savings and additional contribution margin if Boom changes to the new component. Boom Electronics change to the new component. Based upon the incremental costs and revenues, A. Boom can justify investing in the new component only if they sell a minimum of 5,143 additional TVs. B. Boom can justify investing in the new component only if they sell a minimum of 1,143 additional TVs. C. Boom can justify investing in the new component only if they sell a minimum of 3,243 additional TVs. D. Boom can justify investing in the new component without making any additional sales. Requirement 3. What other factors should managers at Boom Electronics consider when making their decision about changing to a new component? (Select all that apply.) B. Higher quality also improves the morale of employees working in the company and their care and commitment to improving processes. C. Management should consider the ability to save on the fixed costs of rework, customer support, and warranty repairs. D. None of the above because the cost of quality should be the only deciding factor

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