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Following a strategy of product differentiation, Barry Company makes an XX 300. Barry Company presents the following data for the years 1 and 2.
Barry Company produces no defective units but it wants to reduce direct materials usage per unit of XX 300 in year 2. Manufacturing conversion costs in each year depend on production capacity defined in terms of XX 300 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Neither conversion costs or customer-service costs are affected by changes in actual volume. Barry Company has 23 customers in year 1 and 25 customers in year 2. The industry market size for high-end appliances increased 5% from year 1 to year 2.
-What is the operating income in year 2?
Liquidated Assets
are assets that have been converted into cash or cash equivalents by selling them on the open market.
Wrongful Dissolution
The improper termination of a partnership or corporate entity in violation of agreements or legal provisions.
Partnership Agreement
A formal contract between two or more parties to manage and operate a business and share its profits or losses.
Wrongful Dissolution
The improper termination of a legal entity or partnership, which can give rise to legal action for damages.
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