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Storm Company must choose between two alternatives, A and B, with the following current costs: A B Utilities costs $14,000 $14,000 Depreciation costs $12,000 $10,000

Storm Company must choose between two alternatives, A and B, with the following current costs: A B Utilities costs $14,000 $14,000 Depreciation costs $12,000 $10,000 Direct labour costs $114,000 $102,000 Fixed manufacturing costs $30,000 $32,000 Required: Which costs are relevant and which costs are not relevant to the decision? (2 marks) What is the differential cost between the two alternatives for decision making purposes? (1 mark)

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