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pls explain Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively Each product uses only one type of
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Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000 units of each product. Its unit costs for each product at this level of activity are given below Direct materials Direct labour Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Cost per unit Alpha $ 30 21 B 17 13 16 $105 Beta 512 20 6 19 9 11 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars. 4. Assume that Cane expects to produce and sell 91000 Betas during the current year. One of Cane's sales representatives has found a new customer that is willing to buy 6,000 additional Betas for a price of $40 per unit. If Cone accepts the customer's offer how much will its profits increase or decrease? Net operating income explain
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