The Foundational $15($Algo$)[$LO$11-2,$ L$011-3,$ LO$11-4,$ LO$11-5,$ LO$11-6]$

$[$The following information applies to the questions displayed below.$]$

Cane Company manufactures two products called Alpha and Beta that sell for $$135$ and $$95,$ respectively. Each product

uses only one type of raw material that costs $$6$ per pound. The company has the capacity to annually produce $105,000$

units of each product. Its average cost per unit for each product at this level of activity are given below:

The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses

are unavoidable and have been allocated to products based on sales dollars.

Foundational $11-6($Algo$)$

Assume that Cane normally produces and sells $93,000$ Betas per year. What is the financial advantage $($disadvantage$)$ of

discontinuing the Beta product line?

The Foundational $15($Algo$)[$LO$11-2,$ L$011-3,$ LO$11-4,$ LO$11-5,$ LO$11-6]$

$[$The following information applies to the questions displayed below.$]$

Cane Company manufactures two products called Alpha and Beta that sell for $$135$ and $$95,$ respectively. Each product

uses only one type of raw material that costs $$6$ per pound. The company has the capacity to annually produce $105,000$

units of each product. Its average cost per unit for each product at this level of activity are given below:

The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses

are unavoidable and have been allocated to products based on sales dollars.

Foundational $11-7($Algo$)$

Assume that Cane normally produces and sells $43,000$ Betas per year. What is the financial advantage $($disadvantage$)$ of

discontinuing the Beta product line?