24 Listen Pine Company makes unfinished bookcases that it sells for $62. Production costs are $36 variable and $10 fixed. Because it has unused capacity, Pine Street is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $6 per unit with no increase in fixed costs. Pine Street should sell A) finished bookcases: the incremental revenues exceed incremental costs by $2.00 per unit. finished bookcases: the incremental revenues exceed incremental costs by $8.00 per unit. C) unfinished bookcases: total finishing costs are %52 per unit B) D) unfinished bookcases: variable finishing costs are expected to be $6 per unit E) none of the above
24 Listen Pine Company makes unfinished bookcases that it sells for $62. Production costs are $36 variable and $10 fixed. Because it has unused capacity, Pine Street is considering finishing the bookcases and selling them for $70. Variable finishing costs are expected to be $6 per unit with no increase in fixed costs. Pine Street should sell A) finished bookcases: the incremental revenues exceed incremental costs by $2.00 per unit. finished bookcases: the incremental revenues exceed incremental costs by $8.00 per unit. C) unfinished bookcases: total finishing costs are %52 per unit B) D) unfinished bookcases: variable finishing costs are expected to be $6 per unit E) none of the above
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 30
M
Listen
Pine Company makes unfinished bookcases that it sells for $62. Production costs are
$36 variable and $10 fixed. Because it has unused capacity, Pine Street is
considering finishing the bookcases and selling them for $70. Variable finishing costs
are expected to be $6 per unit with no increase in fixed costs. Pine Street should sell
A)
B)
finished bookcases: the incremental revenues exceed incremental costs by
$2.00 per unit.
finished bookcases: the incremental revenues exceed incremental costs by
$8.00 per unit.
C) unfinished bookcases: total finishing costs are %52 per unit
D) unfinished bookcases: variable finishing costs are expected to be $6 per unit
OE) none of the above
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