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[The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $185 and $120, respectively.
[The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $185 and $120, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 112,000 units of each product. Its unit costs for each product at this level of activity are given below: The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars. Assume that Cane normally produces and sells 68,000 Betas and 88,000 Alphas per year. If Cane discontinues the Beta product ne, its sales representatives could increase sales of Alpha by 12,000 units. If Cane discontinues the Beta product line, how much vould profits increase or decrease
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