Answer 1-a
Financial advantage | $ 1,091,200 |
Explanation:
Increased Sales in units | $ 30,800 |
Conribution margin per unit | $ 39.00 |
Incremental Contribution | $ 1,201,200 |
Added Fixed expense | $ 110,000 |
Incremental net income | $ 1,091,200 |
Answer 1-b
Yes |
Answer 2
Break even price per unit | $ 27.30 |
Explanation:
Variable manufacturing Cost per Unit | $ 22.30 |
Import duties per unit | $ 2.70 |
Permits | $ 0.60 |
Shipping Cost | $ 1.70 |
Break even price per unit | $ 27.30 |
Answer 3
Relevant unit cost | $ 2.70 |
Explanation:
Only Variable selling cost is considered. This is because all other costs are already incurred and are irrelevant for decision making.
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