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URGENT HELP PLEASE!!!!! 5 Part 5 of 's Required information (The following Information applies to the questions displayed below.) Cane Company manufactures two products called
URGENT HELP PLEASE!!!!!
5 Part 5 of 's Required information (The following Information applies to the questions displayed below.) Cane Company manufactures two products called Alpha and Beta that sell for $130 and $90, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 102,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Alpha Beta Direct materials $25 $10 Direct labor 22 23 Variable manufacturing overbead 17 7 Teaceable fixed manufacturing overhead 18 20 Variable selling expenses 14 10 Common cixed expenses 12 Total cost per unit $123 $00 8 01:21 17 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. 5. Assume that Cane expects to produce and sell 97,000 Alphas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 12,000 additional Alphas for a price of $88 per unit, however pursuing this opportunity will decrease Alpha sales to regular customers by 7000 units a. What is the financial advantage (disadvantage) of accepting the new customer's order? b. Based on your calculations above should the special order be accepted? Complete this question by entering your answers in the tabs below. Req5A Reg 58 what these thumb 6. Assume that Cane normally produces and sells 92.000 Betas per year. What is the financial advantage (disadvantage) of discontinuing the Beta product line? 7. Assume that Cane normally produces and sells 42,000 Betas per year. What is the financial advantage (disadvantage) of discontinuing the Beta product line Step by Step Solution
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