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Question 6 5 pts Intelligent Components manufactures component parts and subassemblies for laptops. The company's research and development (R&D) and market research teams have been
Question 6 5 pts Intelligent Components manufactures component parts and subassemblies for laptops. The company's research and development (R&D) and market research teams have been working on the introduction of a new optical drive for Dell-compatible laptops for some time. R&D created several alternative designs for the optical drives. Of those, three were approved for development into prototypes, but only one will be manufactured and sold. Intelligent Components' engineering and accounting staffs have developed these per-unit variable cost estimates for each of the three optical drive designs. Model A Model B Model C Direct materials $ 150 $ 100 $ 114 Direct labor $ 40 $ 50 $ 48 Variable overhead (computed as 250% of direct labor) $ 100 $ 125 $ 120 Marketing $ 140 $ 140 $ 140 Total $430 $ 415 $ 422 Market research has determined that regardless of the model chosen, the appropriate selling price would be $540 per unit, and sales would be 100,000 units. R&D estimates that fixed costs will be $3,500,000 regardless of the model chosen. Which optical drive model should Intelligent Components choose to manufacture and sell? Model B Model C Model A
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