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Question 5 of 7 Fill in the blanks: StarApple Company recently discontinued the manufacture of Model YPhonex. The standard costs for this product were: Direct
Question 5 of 7 Fill in the blanks: StarApple Company recently discontinued the manufacture of Model YPhonex. The standard costs for this product were: Direct Material $50 Direct Labor 20 Variable Overhead 14 35 $119 Fixed overhead Total 14 Points There are 800 units of this model in finished-goods inventory. The units are technologically obsolete, and the following alternatives are being considered: A. Dispose of as scrap. The proceeds from the sale will equal the cost of transportation to the disposal site. B. Sell to an exporter for sale in a developing country. The sales price to the exporter would be $12 per unit. C. Remanufacture the products to convert them into model YPhoneXR, a model that normally sells for $ 200. The additional cost to convert the YPhonex units would be $ 45; the standard cost to manufacture YPhoneXR is $125. Presently, there is sufficient capacity to manufacture product YPhoneXR directly or to do the necessary conversion work on YPhoneX. B. Sell to an exporter for sale in a developing country. The sales price to the exporter would be $12 per unit. C. Remanufacture the products to convert them into model YPhoneXR, a model that normally sells for $ 200. The additional cost to convert the YPhonex units would be $ 45; the standard cost to manufacture YPhoneXR is $125. Presently, there is sufficient capacity to manufacture product YPhoneXR directly or to do the necessary conversion work on YPhonex. Required: 1. The current carrying value of the YPhoneX inventory is (#1) S 2. In evaluating each alternative, fill in the following missing information: a. The financial benefit of Option A is (#2) S b. The financial benefit of Option B is (#3) $ c. Converting YPhoneX into XR is (more or less?) (#4) per unit d. Therefore, the alternative that offers the most financial benefit is Option (A, B or C?) (#6) income by (#7) $ beneficial than manufacturing YPhoneXR by (#5) S and it will increase operating
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