Easton Company Makes and Sells Scooters Easton Can Currently Purchase the Scooters It Makes from Weston

question 43

Multiple Choice

Easton Company makes and sells scooters.Easton incurred the following costs in its most recent fiscal year: $\begin{array}{c}\text { Cost Items Appearing on the Income Statement }\\\begin{array}{|l|l|}\hline\text { Materials cost ( } \$ 10 \text { per unit) } & \text { Depreciation on manufacturing equipment } \\\hline \text { Company president's salary } & \text { Salaries of administrative personnel } \\\hline \text { Labor cost ( } \$ 4 \text { per unit) } & \text { Research and development costs } \\\hline \text { Advertising costs }(150,000 \text { per year) } & \text { Real estate taxes on factory } \\\hline \text { Shipping and handling (\$0.15 per unit) } & \text { Inspection costs } \\\hline\end{array}\end{array}$ Easton can currently purchase the scooters it makes from Weston Company.If the company purchases the scooters,Easton would still continue to use its own logo,sales staff,and advertising programs.If Easton outsources the scooters to Weston,which of the following costs would be relevant to the outsourcing decision?

• A) Materials cost
• B) Shipping and handling
• C) Inspection costs
• D) All of these answers are correct.

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Definitions:

Neurotransmitters

Biochemicals, released from a sending neuron, that transmit messages to a receiving neuron in the brain and nervous system.

Norepinephrine

Neurotransmitter that is involved in the regulation of mood.

Dopamine

A neurotransmitter involved in the regulation of mood, motivation, pleasure, and reward.

Rates Of Smoking

The proportion or frequency of individuals in a given population who engage in smoking tobacco products over a specific period.