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Required information {The following information applies to the questions displayed below} Cane Company manufactures two products called Alpha and Beta that sell for $215 and
Required information {The following information applies to the questions displayed below} Cane Company manufactures two products called Alpha and Beta that sell for $215 and $160, respectively. Each product uses only one type of raw material that costs $1? per pound. The company has the capacity to annually produce 12 5,000 units of each product. Its unit costs for each product at this level of activity are given below: Alpha Beta Direct materials $ 42 $ 21 Direct: labour 35 23 Variable manufacturing overhead 23 21 Traceable fixed manufacturing overhead 31 34 Variable selling expenses 28 24 Common fixed expenses 31 26 Cost per unit: $190 $154 The company considers its traceable xed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars. 9. Assume that Cane expects to produce and sell 96,000 Alphas during the current year. A supplier has offered to manufacture and deliver 96,000 Alphas to Cane for a price of $144 per unit. If Cane buys 96,000 units from the supplier instead of making those units. howI much will prots increase or decrease
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