Question
Relevant Cost Terms: Matching Astel&Kern produces three different versions of high-quality portable digital music players, the A@ultima, A@futura, and A@norma. Assume Astel&Kern is evaluating a
Relevant Cost Terms: Matching
Astel&Kern produces three different versions of high-quality portable digital music players, the A@ultima, A@futura, and A@norma. Assume Astel&Kern is evaluating a proposal that will result in doubling the production of A@futura and disontinuing the production of A@norma. The facilities currently used to produce A@norma will be devoted to the production of A@futura. Furthermore, additional machinery will be acquired to produce A@futura. The production of A@ultima will not be affected. All products have a positive contribution margin.
Presented below are a number of phrases related to the proposal followed by a list of cost terms. For each phrase, select the most appropriate cost term. Each term is used only once.
Phrases
1. Cost of equipment to produce A@norma
2. Increased variable costs of A@futura
3. Property taxes on the new machinery
4. Revenues from the sale of A@ultima
5. Increased revenue from the sale of A@futura
6. Contribution margin of A@norma
7. Variable costs of A@ultima
8. Company presidents salary
Cost terms
a. Opportunity cost
b. Sunk cost
c. Irrelevant variable outlay cost
d. Irrelevant fixed outlay cost
e. Relevant variable outlay cost
f. Relevant fixed outlay cost
g. Relevant revenues
h. Irrelevant revenues
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started