Xinhong Company is considering replacing one of its manufacturing machines. The machine has a book value of $42,000 and a remaining useful life of 5 years, at which time its salvage value will be zero. It has a current market value of $52,000 Variable manufacturing costs are $33,300 per year for this machine Information on two alternative replacement machines follows. Cost Variable manufacturing costs per year Alternative A $ 118,000 22.600 Alternative B $ 116,000 10,800 Calculate the total change in net income i Alternative A is adopted (Cash outflows should be indicated by a minus sign.) ALTERNATIVE A: INCREASE OR (DECREASE) IN NET INCOME Cost to buy new machine Cash received to trade in old machine Reduction in variable manufacturing costs Total change in net income $ 0 Calculate the total change in net income i Alternative B is adopted (Cash outflows should be indicated by a minus sign) ALTERNATIVE B: INCREASE OR (DECREASE) IN NET INCOME Cost to buy new machine Cash received to trade in old machine Reducbon in variablo manufacturing costs Total change in net income $ 0 166 points Coursework - Stude... M McGraw-Hill Conne 2 Dashi Call Company produces skateboards that sell for $55 per unit. The company currently has the capacity to produce 90,000 skateboards per year, but is soling 81,100 skateboards per year. Annual costs for 81,100 skateboards follow Direct materials Direct labor Overhead Selling expenses Administrative expenses $ 167,770 673,130 942.000 545,000 478,000 Total costs and expenses $3,505,000 A new retail store has offered to buy 8.900 of its skateboards for $50 per unit. The stores in a different market from Cala's regular customers and would not affect regular sales. A study of its costs in anticipation of the additional business reveals the following Direct materials and direct labor are 100% variable 40 percent of overhead is foed at any production level from 81.100 units to 90,000 units, the remaining 60% of annuni overhead costs are variable with respect to volume Selling expenses are 70% variable with respect to number of units sold, and the other 30% of selling expenses are fixed There will be an additional $1 1 per unit selling expense for this order - Administrative expenses would increase by a $910 fixed amount Required: Prepare a three-column comparative income statement that reports the following a. Annual income without the special order b. Annual income from the special order c Combined annual income from normal business and the new business (Do not round your intermediate calculation round your cost and expenses values to nearest whole decimal places) CALLA COMPANY COMPARATIVE INCOME STATEMENTS Nemam Additional Dahal U ovom liked at any production overom 81,100 units to 90,000 US, the remaining 60% of annual overhead costs are variable with respect to volume Selling expenses are 70% variable with respect to number of units sold, and the other 30% of selling experises are fixed There will be an additional $1.1 per unit selling expense for this order - Administrative expenses would increase by a $910 fixed amount Required: Prepare a three-column comparative income statement that reports the following a. Annual income without the special order b. Annual income from the special order c. Combined annual income from normal business and the new business, (Do not round your intermediate calculation round your cost and expenses values to nearest whole decimal places) CALLA COMPANY COMPARATIVE INCOME STATEMENTS Normal Volume Additional Volume Combined Total Costs and expenses 0 0 0 Total costs and expenses Operating income