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The Foundational 1 5 ( Algo ) [ LO 1 1 - 2 , L 0 1 1 - 3 , LO 1 1 -

The Foundational 15(Algo)[LO11-2, L011-3, LO11-4, LO11-5, LO11-6]
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Cane Company manufactures two products called Alpha and Beta that sell for $135 and $95, respectively. Each product
uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 105,000
units of each product. Its average cost per unit 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 unavoidable and have been allocated to products based on sales dollars.
Foundational 11-4(Algo)
Assume that Cane expects to produce and sell 93,000 Betas during the current year. One of Cane's sales representatives has found
a new customer who is willing to buy 4,000 additional Betas for a price of $42 per unit. What is the financial advantage (disadvantage)
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