Altertech Inc The Required Volume of Output to Produce the Circuit Boards

question 98

Multiple Choice

Altertech Inc.manufactures a product that contains a circuit board.The company has always purchased this circuit board from a supplier for $32 each.Altertech recently upgraded its own manufacturing capabilities and now has enough excess capacity (including trained workers) to begin manufacturing the circuit board instead of buying it.The company prepared the following per unit cost projections of making the circuit board,assuming that overhead is allocated to the part at the normal predetermined overhead rate of 110% of direct labor cost.
$$\begin{array} { l l } \text { Direct materials } & \$ 2 \\\text { Direct labor } &2 0 \\\text { Overhead (fixed and } & 2 2 \\\text { variable) } & \\\text { Total } & \$ 44\end{array}$$
The required volume of output to produce the circuit boards will not require any incremental fixed overhead.Incremental variable overhead cost is $3 per circuit board.What is the effect on income if Altertech decides to make the circuit boards?

• A) Income will decrease by $7 per unit.
• B) Income will increase by $7 per unit.
• C) Income will increase by $12 per unit.
• D) Income will decrease by $12 per unit.
• E) Income will increase by $10 per unit.

Grasp the significance of culture, shared ideas, and praxis in shaping human behaviors and societal norms.

Appreciate the complexities of human and animal sexual behaviors and roles through an evolutionary lens.

Comprehend the fundamental principles of evolutionary theory and their application to human and animal behavior.

Recognize the interplay between culture and biology in human dietary practices and choices.

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Definitions:

Medulla Oblongata

A part of the brainstem that regulates vital bodily functions such as breathing, heart rate, and blood pressure.

Pons

A part of the brainstem that bridges the medulla oblongata and the midbrain, playing a crucial role in many bodily functions, including breathing and sleep.

pH

A scale used to specify how acidic or basic a water-based solution is, where 7 is neutral, lower values are more acidic, and higher values are more alkaline.

Respiratory Rate

The number of breaths taken per minute, a vital sign used to assess overall health and respiratory function.