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10. Question:( TCO 7) A company is currently making a necessary component in house( the company is producing the component for its own use). The company has received an offer to buy the component from an outside supplier. A machine is being rented to make the component. If the company were to buy the component, the machine would no longer be rented. The rent on the machine, in relation to the decision to make or buy the component, is: 11. Question:( TCO 7) Ricket Company has 1,500 obsolete calculators that are carried in inventory at a cost of $ 13,200. If these calculators are upgraded at a cost of $ 9,500, they could be sold for $ 22,500. Alternatively, the calculators could be sold " as is " for $ 9,000. What is the net advantage or disadvantage of reworking the calculators? 12. Question:( TCO 7) YXZ Company’ s market for the Model 55 has changed significantly, and YXZ has had to drop the price per unit from $ 275 to $ 135. There are some units in the work in process inventory that have costs of $ 160 per unit associated with them. YXZ could sell these units in their current state for $ 100 each. It will cost YXZ $ 10 per unit to complete these units so that they can be sold for $ 135 each.
When the incremental revenues and expenses are analyzed, what is the financial impact? 1. Question:( TCO 3) What are transferred-in costs? Which departments will never have transferred-in costs?
2. Question:( TCO 7) Computer Boutique sells computer equipment and home office furniture. Currently, the furniture product line takes up approximately 50 % of the company ' s retail floor space. The president of Computer Boutique is trying to decide whether the company should continue offering furniture or just concentrate on computer equipment. If furniture is dropped, salaries and other direct fixed costs can be avoided.