Required information [The following information applies to the questions displayed below) Cane Company manufactures two...
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Required information [The following information applies to the questions displayed below) Cane Company manufactures two products called Alpha and Beta that sell for $165 and $130, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 113,000 units of each product. Its average cost per unit for each product at this level of activity are given below. Alpha Beta Direct materials 5.40 $ 24 Direct labor 29 25 Variable manufacturing overhead Traceable fixed manufacturing overhead 27 Variable selling expenses 21 Common fixed expenses 24 19 Total cost per unit $ 154 $ 126 14 15 25 17 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 4. Assume that Cone expects to produce and sell 99,000 Betas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 2.000 additional Betas for a price of $48 per unit. What is the financial advantage (disadvantage) of accepting the new customer's order? Financial (disadvantage)
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