San Isidro Co. manufactures ballpoint pens. Another manufacturer has offered to supply San Isidro with the...
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San Isidro Co. manufactures ballpoint pens. Another manufacturer has offered to supply San Isidro with the 5,000 ink cartridges that it needs annually. The cost to buy the cartridges would be P15 each. In producing its own cartridges, San Isidro has incurred P10 in fixed costs and P8 in variable costs. If San Isidro buys the cartridges, its net income will: A. not change B. increase by P35,000 C. decrease by P35,000 D. increase by P25,000 San Isidro Co. manufactures ballpoint pens. Another manufacturer has offered to supply San Isidro with the 5,000 ink cartridges that it needs annually. The cost to buy the cartridges would be P15 each. In producing its own cartridges, San Isidro has incurred P10 in fixed costs and P8 in variable costs. If San Isidro buys the cartridges, its net income will: A. not change B. increase by P35,000 C. decrease by P35,000 D. increase by P25,000
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Answer Given The cost of manufacturing is Variable cost P8 Fixed cost P10 The fixed cost are un... View the full answer
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
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