Assume That If the Component Is Purchased from the Outside

question 134

Multiple Choice

Assume that if the component is purchased from the outside supplier,$35,100 of annual fixed manufacturing overhead would be avoided and the facilities now being used to make the component would be rented to another company for $64,800 per year.If Rogers chooses to buy the component from the outside supplier under these circumstances,then the impact on annual net operating income due to accepting the offer would be:

• A) $18,900 decrease.
• B) $18,900 increase.
• C) $21,400 decrease.
• D) $21,400 increase.

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Definitions:

Evaluation Training

The systematic assessment of the design, implementation, and outcomes of training programs to determine their effectiveness and to make informed decisions on their improvement.

Correlation Analyses

Statistical techniques used to measure and describe the strength and direction of the relationship between two variables.

Reliability

The consistency and dependability of a process, system, or measurement.

Contamination

The presence of unwanted substances in materials, environments, or products, leading to pollution or infection.