Blueberry Electronics is exploring the possibility of producing a new handheld device that will serve both as a basic PC with Internet access and as a cell phone. Which of the following items are incremental costs for the project’s analysis?
a. Research and development funds that the company has spent while working on a prototype of the new product.
b. The company’s current-generation product has no cell phone capability. The new product may therefore make the old one obsolete in the eyes of many consumers. However, Blueberry expects that other companies will soon bring to market products combining cell phone and PC features, which will also reduce sales on Blueberry’s existing products.
c. Costs of ramping up production of the new device.
d. Increases in receivables and inventory that will occur as production increases.

  • CreatedMarch 26, 2015
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