Use the information in the image to answer questions 6 through 10.

6) Assume that Cane normally produces and sells 90,000 Betas per year. What is the financial advantage (disadvantage) of discontinuing the Beta product line?

7) Assume that Cane normally produces and sells 40,000 Betas per year. What is the financial advantage (disadvantage) of continuing the Beta product line?

8) Assume that Cane normally produces and sells 60,000 Betas and 80,000 Alphas per year. If Cane discontinues the Beta product line, its sales representatives could increase sales of Alpha by 15,000 units. What is the financial advantage (disadvantage) of discontinuing the Beta product line?

9) Assume that Cane expects to produce and sell 80,000 Alphas during the current year. A supplier has offered to manufacture and deliver 80,000 Alphas to Cane for a price of $80 per unit. What is the financial advantage (disadvantage) of buying 80,000 units from the supplier instead of making those units?

10) Assume that Cane expects to produce and sell 50,000 Alphas during the current year. A supplier has offered to manufacture and deliver 50,000 Alphas to Cane for a price of $80 per unit. What is the financial advantage (disadvantage) of buying 50,000 units from the supplier instead of making those units?

Chapter 12 Foundational Problem 1 BETA ALPHA $24 20 $18 16 6 10 2 3 UNIT COSTS(based on production of 100,000 units of each product). 4 DIRECT MATERIAL 5 DIRECT LABOR 6 VARIABLE OVERHEAD 7 VARIABLE SALES 8 TRACEABLE FIXED 9 COMMON FIXED COST 6 10 12 10 14 12 10 $120 $80 11 ADDITIONAL INFORMATION 6 6 12 SELLING PRICE PER UNIT 13 MATERIAL COST PER POUND 14 The company considers its traceable fixed cost to be avoidable. 15 whereas its common fixed expenses are unavoidabel. 1 thru 5