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Wentworth Toys is a manufacturer of action figures for children. The primary machine used to manufacture the action figures is the model A15 machine. The
Wentworth Toys is a manufacturer of action figures for children. The primary machine used to manufacture the action figures is the model A15 machine. The company is considering replacing the old model A15 machine with a new model B20 machine. The change will have no effect on production costs, other than some savings in direct material costs due to less waste. If the model B20 machine is used, sales are expected to increase due to improved quality. The model A15 machine would be sold. Indicate whether each item is relevant or irrelevant.
Depreciation Cost (to date) - model A15 machine | Answer 1Choose...RelevantIrrelevant |
Sales Revenue | Answer 2Choose...RelevantIrrelevant |
Market value - model B20 machine (cost) | Answer 3Choose...RelevantIrrelevant |
Variable Manufacturing Overhead | Answer 4Choose...RelevantIrrelevant |
Disposal value - model A15 machine | Answer 5Choose...RelevantIrrelevant |
Direct Labor | Answer 6Choose...RelevantIrrelevant |
Direct Materials | Answer 7Choose...RelevantIrrelevant |
Book value - model A15 machine | Answer 8Choose...RelevantIrrelevant |
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