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Question 11 Coronado Industries has the following costs when producing 100000 units: Variable costs $600000 Fixed costs 900000 An outside supplier has offered to make the item at $4.50 a unit. If the decision is made to purchase the item outside, current production facilities could be leased to another company for $178000. The net increase (decrease) in the net income of accepting the supplier's offer is $(28000). $788000. $272000. $328000. Question 12 Marigold Corp. has the following costs when producing 100000 units: Variable costs $600000 Fixed costs 900000 An outside supplier is interested in producing the item for Marigold. If the item is produced outside, Sandusky could use the released production facilities to make another item that would generate $70000 of net income. At what unit price would Marigold accept the outside supplier's offer if Marigold wanted to increase net income by $40000? $6.30 $6.70 $7.10 $5.70 Question 13 Concord Corporation manufactures widgets. Embree Company has approached Concord with a proposal to sell the company widgets at a price of $135000 for 100000 units. Concord is currently making these components in its own factory. The following costs are associated with this part of the process when 100000 units are produced: Direct materials 46500 Direct labor 43500 Manufacturing overhead 60000 $150,000 Total The manufacturing overhead consists of $22000 of costs that will be eliminated if the components are no longer produced by Concord. From Concord's point of view, how much is the incremental cost or savings if the widgets are bought instead of made? $23000 incremental savings $15000 incremental cost $15000 incremental savings $23000 incremental cost

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