Perez Corporation makes and sells state-ofthe-art electronics products. One of its segments produces The Math Machine, an inexpensive calculatot. The company's chief accountant recently prepared the following income statement showing annual revenues and expenses associated with the segment's operating activities. The relevant range for the production and sale of the calculators is between 34,000 and 73,000 units per yeat. Pequired a. A large discount store has approached the owmer of Perez about buying 4.000 calculators, it would replace The Math Mochine's Iabol whth its own logo to avoid affecting Perez's existing customers. Because the offer was made directly to the owner no sales commissions on the transaction would be involved, but the discount store is willing to pay only $5.20 por calculator, Colculate the contribution margin from the special order, Based on quantitative factors alone, should Perez accept the speciat order? b-1. Perez has an opportunity to buy the 41,000 calculators it cuitenty makes from a roliable competing manufacturer for $4,40 each. The product meets Perez's quality standards. Perez could continue to use its own logo, advertising program, and sales force to distribute the products. Colculate the total cost for Perez to make and buy the 41,000 colculators b-2. Should perez buy the colculators or continue to make them? b-3. Should Perez buy the calculators of continue to make them, If the volume of sales were increased to 73,000 units? c. Because the calculator division is currenty operating at a loss, should it be eliminated from the company/s operations? 5 upport your answor with appropriate computations, Specifically, by what amount would the segment's elimination increase or docrease protiability? A large discount store has approached the owner of Perez about buying 4,000 calculators. It would replace The Math Machine's label with its own logo to avold affecting Perez's existing customers. Because the offer was made directly to the owner, no sales commissions on the transaction would be involved, but the discount store is willing to pay only $5.20 per calculator. Calculate the contribution margin from the special order. Based on quantitative factors alone, should Perez accept the special order? (Negative amounts should be indicated by a minus sign.) Perez has an opportunity to buy the 41,000 calculators it currently makes from a reliable competing manufacturer for $4,40 each. The product meets Perez's quality standards. Perez could continue to use its own logo, advertising program, and sales force to distribute the products. Caiculate the total cost for Perez to make and buy the 41,000 calculators. Should Perez buy the calculators or wequired 82 co make them? Complete this question by entering your answers in the tabs below. Should Perez buy the calculators or continue to make them, if the volume of sales were increased to 73,000 units? Because the calculator division is currently operating at a loss, should it be eliminated from the company's operations? Support your answer with appropriate computations. Specifically, by what amount would the segment's elimination increase or decrease profitability? (Negative amounts should be indicated bp a minus sign.)
