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Question 5 (2.5 points) Saved Listen Expo Manufacturing Inc., is in the process of evaluating...

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Question 5 (2.5 points) Saved Listen Expo Manufacturing Inc., is in the process of evaluating a new product using the following information: A new transformer has three production runs each year, each with $15,000 in setup costs. The new transformer incurred $50,000 in development costs and is expected to be produced over the next three years. Direct costs of producing the transformers are $40,000 per run of 5700 transformers each. Indirect manufacturing costs charged to each run are $115,000. Destination charges for each transformer average $2.00. Customer service expenses average $0.70 per transformer. The transformers are selling for $35 the first year and will increase by $2 each year thereafter. Sales units equal production units each year. - What is the estimated life-cycle operating income for the first three years? $556,170 $2,196,970 $179,590 $2,221,170

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