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In: Accounting[The following informationapplies to the questions displayed below.]Cane Company manufactures two products called Alpha...[The following informationapplies to the questions displayed below.]Cane Company manufactures two products called Alpha and Betathat sell for $185 and $150, respectively. Each product uses onlyone type of raw material that costs $8 per pound. The company hasthe capacity to annually produce 119,000 units of each product. Itsunit costs for each product at this level of activity are givenbelow:AlphaBeta Direct materials$40$24 Direct labor3328 Variablemanufacturing overhead2018 Traceable fixedmanufacturing overhead2831 Variable sellingexpenses2521 Common fixedexpenses2823 Total cost perunit$174$145The company considers its traceable fixed manufacturing overheadto be avoidable, whereas its common fixed expenses are deemedunavoidable and have been allocated to products based on salesdollars.1.What is the total amount of traceable fixed manufacturingoverhead for the Alpha product line and for the Beta product line?Traceable fixed manufacturing overhead? Alpha - Beta2.What is the company’s total amount of common fixed expenses? Totalcommon fixed expenses?3.Assume that Cane expects to produce and sell 93,000 Alphasduring the current year. One of Cane's sales representatives hasfound a new customer that is willing to buy 23,000 additionalAlphas for a price of $132 per unit. If Cane accepts the customer’soffer, how much will its profits increase or decrease? Netoperating income by?4.Assume that Cane expects to produce and sell 103,000 Betasduring the current year. One of Cane’s sales representatives hasfound a new customer that is willing to buy 2,000 additional Betasfor a price of $61 per unit. If Cane accepts the customer’s offer,how much will its profits increase or decrease? Net operatingincome by?
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