Expo Manufacturing Inc., is in the process of evaluating a new product using the following information:...

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Expo Manufacturing Inc., is in the process of evaluating a new product using the following information: A new transformer has three production runs each year, each with $14,000 in setup costs. • The new transformer incurred $50,000 in development costs and is expected to be produced over the next three years. • Direct costs of producing the transformers are $55,000 per run of 5,100 transformers each. ● Indirect manufacturing costs charged to each run are $55,000. • Destination charges for each transformer average $4.00. ● Customer service expenses average $0.20 per transformer. • The transformers are selling for $40 the first year and will increase by $2 each year thereafter. • Sales units equal production units each year. What are estimated life-cycle revenues? A. $1,254,600 B. $1,927,800 C. $612,000 D. $1,897,200 Expo Manufacturing Inc., is in the process of evaluating a new product using the following information: A new transformer has three production runs each year, each with $14,000 in setup costs. • The new transformer incurred $50,000 in development costs and is expected to be produced over the next three years. • Direct costs of producing the transformers are $55,000 per run of 5,100 transformers each. ● Indirect manufacturing costs charged to each run are $55,000. • Destination charges for each transformer average $4.00. ● Customer service expenses average $0.20 per transformer. • The transformers are selling for $40 the first year and will increase by $2 each year thereafter. • Sales units equal production units each year. What are estimated life-cycle revenues? A. $1,254,600 B. $1,927,800 C. $612,000 D. $1,897,200

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Explanations Amount First Year 5100 transformers ... View the full answer