3.13 Topic 8
Exercises
8-14 (1) Total relevant costs of the New Machine = $465,000
8-16 (1) Total variable costs = $81
8-18 (1) Cost Difference between making or buying = $624,000
8-20 Net expected benefit of Alternative 2 = $342,000
8-22 (1) Loss if Roast is processed further = $(10,000)
8-24 Product line contribution = $192,500
8-26 (2) Maximum production of Turbo Engine = 10,000 units
Problems
8-28 (1) Opportunity cost = $640,000
8-30 (1) Total 5-year cost to make Danishes with Machine B = $233,500
8-32 (2) Differential costs to make the part = $544,000
8-34 (1) Net income with Baseballs and Bats = $30,000
8-36 Lost contribution if shut down = $140,000
8-38 (1) Calculon Model Contribution margin = $22.50
8-40 (2) Net contribution from advertising Charger = $30,000