QUESTION 4 Rambo Company has three products, A, B, and C. The following information is available: Product A $68,000 39,000 29,000 Product B $95,000 49,000

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QUESTION 4 Rambo Company has three products, A, B, and C. The following information is available: Product A $68,000 39,000 29,000 Product B $95,000 49,000 46,000 Productc $22,000 15,000 7000 Sales Variable costs Contribution margin Fixed costs: Avoidable Unavoidable Operating income 10,000 12000 $7000 17,000 12000 $17,000 6000 9400 $ (8400) Rambo Company is thinking of dropping Product C because it is reporting a loss. Assuming Rambo drops Product C and does NOT replace it, operating income will o increase by $8400 increase by $6000 decrease by $1000 decrease by $15,400 QUESTION 5 Genent's Preserves currently makes jams and jellies and a variety of decorative jars used for packaging. An outside supplier has offered to supply all of the needed decorative jars. For this make-or-buy decision, a cost analysis revealed the following avoidable unit costs for the decorative jars: Direct materials $0.57 Direct labor 0.13 Unit-related support costs 0.22 Batch-related support costs 0.31 Product-sustaining support costs 0.44 Facility-sustaining support costs 0.57 Total cost per jar $224 The maximum price that Genent's Preserves should be willing to pay for the decorative jars is $0.44 per jar $0.92 per jar $0.70 per jar $2.24 per jar