Two Alternatives, Identified X and Y, Are Under Consideration at Hayden

question 113

Multiple Choice

Two alternatives, identified X and Y, are under consideration at Hayden Corporation. Costs associated with the alternatives are listed below.
$$\begin{array} { l r r } & \text { Alternative X } & \text { Alternative Y } \\\text { Material costs } & \$ 44,000 & \$ 56,000 \\\text { Processing costs } & 37,000 & 59,000 \\\text { Building costs } & 14,000 & 14,000 \\\text { Equipment rental } & 11,000 & 11,000\end{array}$$
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Are the materials costs and processing costs differential in the choice between alternatives X and Y? (Ignore the building costs and equipment rental in this question.)

• A) Both materials costs and processing costs are differential.
• B) Only materials costs are differential.
• C) Only processing costs are differential.
• D) Neither materials costs nor processing costs are differential.

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Definitions:

Written Contract

A legally binding agreement between two or more parties that is documented and signed in writing.

Period of Two Years

A specific duration or time frame that spans exactly twenty-four months or two calendar years.

Part Performance

An equitable doctrine that allows a contract, typically not in writing, to be enforced if one party has taken significant steps to perform their part of the agreement.

Interest in Land

Legal rights or investments in real estate that involve ownership or other financial claims on the property.