Question
Saalfrank Corporation is considering two alternatives that are code-named M and N. Costs associated with the alternatives are listed below: Alternative M Alternative N Supplies
Saalfrank Corporation is considering two alternatives that are code-named M and N. Costs associated with the alternatives are listed below:
Alternative M | Alternative N | |
---|---|---|
Supplies costs | $ 62,000 | $ 59,000 |
Assembly costs | $ 40,000 | $ 40,000 |
Power costs | $ 20,000 | $ 30,500 |
Inspection costs | $ 33,000 | $ 22,000 |
Required:
a. Which costs are relevant and which are not relevant in the choice between these two alternatives?
b. What is the differential cost between the two alternatives?
Saalfrank Corporation is considering two alternatives that are code-named M and N. Costs associated with the alternatives are listed below:
Alternative M | Alternative N | |
---|---|---|
Supplies costs | $ 62,000 | $ 59,000 |
Assembly costs | $ 40,000 | $ 40,000 |
Power costs | $ 20,000 | $ 30,500 |
Inspection costs | $ 33,000 | $ 22,000 |
Required:
a. Which costs are relevant and which are not relevant in the choice between these two alternatives?
b. What is the differential cost between the two alternatives?
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