Question 22 (4 points) V Company has 300 obsolete microcomputers that were manuf

Question

Question 22 (4 points)

V Company has 300 obsolete microcomputers that were manufactured at a cost of $440,000. If these microcomputers are upgraded at a total cost of $110,000, they can be sold for a total of $165,000. As an alternative, the microcomputers can be sold in their present condition for $70,000. If the company decides to upgrade the microcomputers as opposed to selling them in their present condition, what is the net advantage or disadvantage of upgrading rather than selling them in their present condition?

Question 22 options:

$15,000 disadvantage

$385,000 disadvantage

$165,000 advantage

$55,000 advantage

Question 23 (4 points)

Q Company has the following production and cost data for two products, X and Y:

The company has 30,000 machine hours available each period, can add as much direct labor as needed and there is unlimited demand for each product. How many units of product X and product Y, respectively, should be produced each period to maximize contribution margin?

Question 23 options:

10,000 units of X and 15,000 units of Y

10,000 units of X and 0 units of Y

10,000 units of X and 7,500 units of Y

0 units of X and 15,000 units of Y

a)

$15,000 disadvantage

b)

$385,000 disadvantage

c)

$165,000 advantage

d)

$55,000 advantage

Explanation / Answer

22 Net advantage (disadvantage) = (165000-70000)-110000= $15,000 disadvantage 23 Product X Product Y Contribution margin per unit 24 18 Machine-hours needed per unit 3 2 Contribution margin per machine hour 8 9 Preference in Production 2 1 Units of Product Y to be manufactured = 30000/2 = 15000 units 0 units of X and 15,000 units of Y

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