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Tharp Company operates a small factory in which it manufactures two products: C and D. Production and sales results for last year were as follows.
Tharp Company operates a small factory in which it manufactures two products: C and D. Production and sales results for last year were as follows.
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Exercise 20-17 Tharp Company operates a small factory in which it manufactures two products: C and D. Production and sales results for last year were as follows Units sold Selling price per unit Variable cost per unit Fixed cost per unit 8,900 19,600 $77 41 $94 48 For purposes of simplicity, the firm averages total fixed costs over the total number of units of C and D produced and sold The research department has developed a new product (E) as a replacement for product D. Market studies show that Tharp Company could sell 11,600 units of E next year at a price of $115; the variable cost per unit of E is $45 The introduction of product E will lead to a 11% increase in demand for product C and discontinuation of product D If the company does not introduce the new product, it expects next year's results to be the same as last year's Compute company profit with products C & D and with products C & E Net profit with products C&D s Net profit with products C & E Should Tharp Company introduce product E next year
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